The sale of equipment at a gain would be shown on the statement of cash flows prepared under the indirect method in which of the following manners?
A)Cash received would be shown under Investing Activities and the gain would be subtracted from net income.
B)Cash received would be shown under Investing Activities and the gain would be added to net income.
C)Cash received would be shown under Investing Activities and the gain would not appear on the statement of cash flows.
D)Cash received would be shown as an adjustment to net income and the gain would not appear on the statement of cash flows.

Question

Quizplus · Accepted Answer

The cash received from the sale is shown under Investing Activities, and the gain is subtracted from net income in the Operating Activities section to adjust for non-cash items.

The Sale of Equipment at a Gain Would Be Shown