The records of Billie's Surfboards showed a purchase of equipment in the amount of $24,800; sale of equipment in the amount of $14,900; and a purchase of land in the amount of $30,500. The amount of Net Cash Flow from Investing Activities using the indirect method is:

Question

Quizplus · Accepted Answer

Net Cash Flow from Investing Activities is calculated by adding up all cash inflows and outflows from investing activities. Here, the purchase of equipment ($24,800) and the purchase of land ($30,500) are cash outflows, while the sale of equipment ($14,900) is a cash inflow. Therefore, the net cash flow is -$24,800 (purchase of equipment) - $30,500 (purchase of land) + $14,900 (sale of equipment) = -$40,400. The negative sign indicates an outflow of cash, hence the correct answer is D) ($40,400).

The Records of Billie's Surfboards Showed a Purchase of Equipment