What is the effect of the sale of $3,000 worth of cash equivalents at cost in the statement of cash flows prepared under the direct method?
A) Add $3,000 in the reconciliation
B) No disclosure
C) $3,000 operating cash inflow
D) $3,000 investing cash inflow

Question

Quizplus · Accepted Answer

Cash equivalents are considered part of cash and cash equivalents in the cash flow statement, so their sale at cost does not affect the cash flow statement under the direct method.

What Is the Effect of the Sale of $3,000 Worth