The following information was taken from the 2008 financial statements of Sawyer Corporation:
During 2008
• A $450,000 payment was made to retire bonds payable with a face amount of $500,000.
• Bonds payable with a face amount of $200,000 were issued in exchange for equipment.
In its statement of cash flows for the year ended December 31, 2008, what amount should Sawyer report as proceeds from issuance of bonds payable?
A) $1,500,000
B) $1,750,000
C) $1,800,000
D) $2,200,000

Question

The following information was taken from the 2008 financial statements of Sawyer Corporation:
 During 2008
• A $450,000 payment was made to retire bonds payable with a face amount of $500,000.
• Bonds payable with a face amount of $200,000 were issued in exchange for equipment.
In its statement of cash flows for the year ended December 31, 2008, what amount should Sawyer report as proceeds from issuance of bonds payable?
A) $1,500,000 
B) $1,750,000 
C) $1,800,000 
D) $2,200,000

Quizplus · Accepted Answer

$2,000,000 - $500,000 + $500,000 - $200,000 = $1,800,000.

The Following Information Was Taken from the 2008 Financial Statements