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Cornerstones of Managerial Accounting 4th Edition by Maryanne Mowen, Don Hansen, Dan Heitger
Edition 4ISBN: 978-0324380767Cornerstones of Managerial Accounting 4th Edition by Maryanne Mowen, Don Hansen, Dan Heitger
Edition 4ISBN: 978-0324380767 Exercise 39
Cash Flow from Investing Activities
During 2011, Baker Company had the following transactions:
a. Purchased $100,000 of 10-year bonds issued by Makenzie, Inc.
b. Acquired land valued at $35,000 in exchange for machinery.
c. Sold equipment with original cost of $270,000 for $165,000; accumulated depreciation taken on the equipment to the point of sale was $90,000.
d. Purchased new machinery for $120,000.
e. Purchased common stock in Lemmons Company for $55,000.
Required:
1. Prepare the net cash from investing activities section of the statement of cash flows.
2. Conceptual Connection: Usually, the net cash from investing activities is negative. How can Baker cover this negative cash flow What other information would you like to have to make this decision
During 2011, Baker Company had the following transactions:
a. Purchased $100,000 of 10-year bonds issued by Makenzie, Inc.
b. Acquired land valued at $35,000 in exchange for machinery.
c. Sold equipment with original cost of $270,000 for $165,000; accumulated depreciation taken on the equipment to the point of sale was $90,000.
d. Purchased new machinery for $120,000.
e. Purchased common stock in Lemmons Company for $55,000.
Required:
1. Prepare the net cash from investing activities section of the statement of cash flows.
2. Conceptual Connection: Usually, the net cash from investing activities is negative. How can Baker cover this negative cash flow What other information would you like to have to make this decision
Explanation
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Working note-1: Calculation of Loss on s...
Cornerstones of Managerial Accounting 4th Edition by Maryanne Mowen, Don Hansen, Dan Heitger
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