Land costing $71,000 was sold for $50,000 cash. The loss on the sale was reported on the income statement as other expense. On the statement of cash flows, what amount should be reported as an investing activity from the sale of land?

Question

Quizplus · Accepted Answer

The amount reported on the statement of cash flows for the sale of land is the cash received from the sale, which in this case is $50,000. The original cost of the land is not relevant for the statement of cash flows, which only reports cash transactions. The fact that there was a loss on the sale is accounted for in the income statement as other expense, but it does not affect the amount reported in the investing activities section of the statement of cash flows. Therefore, the correct answer is A) $50,000.

Land Costing $71,000 Was Sold for $50,000 Cash