Martin Company is preparing its statement of cash flows using the indirect method. During the year, they sold equipment for $5,990 cash. The net book value of the asset prior to sale was $5,550. Which of the following statements is true?
A)The gain on sale of $440 would be added back to net income in the operating activities section.
B)The book value of the assets sold would be shown as a negative cash flow in the investing activities section.
C)The cash receipt of $5,990 would be shown as a positive cash flow in the investing activities section.
D)The gain on sale of $440 would be shown as a positive cash flow in the financing activities section.

Question

Quizplus · Accepted Answer

The Answer of Martin Company is preparing its statement of cash flows using the indirect method. During the year, they sold equipment for $5,990 cash. The net book value of the asset prior to sale was $5,550. Which of the following statements is true?
A)The gain on sale of $440 would be added back to net income in the operating activities section.
B)The book value of the assets sold would be shown as a negative cash flow in the investing activities section.
C)The cash receipt of $5,990 would be shown as a positive cash flow in the investing activities section.
D)The gain on sale of $440 would be shown as a positive cash flow in the financing activities section.

Martin Company Is Preparing Its Statement of Cash Flows Using