Burton Company purchased a new crane costing $47,000 from Heavy Equipment Corporation.To pay for the crane, Burton traded in an old piece of machinery worth $10,000 and signed a note for the balance of $37,000.How will this transaction be reported on the statement of cash flows?

Question

Quizplus · Accepted Answer

This transaction is considered a non-cash investing and financing activity because the crane was acquired through a trade-in and a note payable, rather than using cash. Non-cash transactions are not reported in the cash flows from operating, investing, or financing sections but are disclosed elsewhere in the financial statements.

Burton Company Purchased a New Crane Costing $47,000 from Heavy