A company sold a piece of land for $40,000 which had an original cost of $55,000.What is the cash flow effect of this transaction?

Question

Quizplus · Accepted Answer

The sale of land represents a cash inflow from investing activities, not from operations. The cash flow effect of the transaction would be a $40,000 increase in cash flows from investing activities, as that's the amount of cash the company received from selling the land. Therefore, option D is the correct answer.

A Company Sold a Piece of Land for $40,000 Which