If a firm sells for $8,000 equipment that cost $25,000 and has $20,000 of accumulated depreciation,how is this reported in the statement of cash flows?

Question

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The sale of equipment is reported as an investing activity for the cash received ($8,000). The difference between the book value ($5,000, calculated as $25,000 cost minus $20,000 accumulated depreciation) and the sale price ($8,000) results in a $3,000 gain, which is subtracted from net income in the operating activities section to adjust for the gain that did not result in cash inflow.

If a Firm Sells for $8,000 Equipment That Cost $25,000