The accounting records of Dominick Inc.indicate that the firm sold for $1,800 during Year 2 a machine originally costing $6,000, with accumulated depreciation of $4,600.The journal entry made to record this sale was as follows:
Cash ........................................1,800
Accumulated Depreciation.......................4,600
Equipment..........................................6,000
Gain on Disposal of Equipment...........................400

(Use the information about Dominick Inc.to answer this question.) In preparing the Statement of cash flows, all the cash proceeds of $1,800 appear as an increase in cash from

Question

The accounting records of Dominick Inc.indicate that the firm sold for $1,800 during Year 2 a machine originally costing $6,000, with accumulated depreciation of $4,600.The journal entry made to record this sale was as follows:
Cash ........................................1,800
Accumulated Depreciation.......................4,600
Equipment..........................................6,000
Gain on Disposal of Equipment...........................400

(Use the information about Dominick Inc.to answer this question.) In preparing the Statement of cash flows, all the cash proceeds of $1,800 appear as an increase in cash from

Quizplus · Accepted Answer

The sale of equipment represents a disposal of a long-term asset, which falls under investing activities in the statement of cash flows. The cash proceeds of $1,800 should be reported as an increase in cash from investing activities.

The Accounting Records of Dominick Inc