If a gain of $7,116 is realized in selling (for cash) office equipment having a book value of $64,521, find the total amount reported in the cash flows from investing activities section of the statement of cash flows. Select the correct answer. A. $57,405 B. $71,637 C. $7,116 D. $64,521

Question

Business

Zoe Mccormick

22 August, 09:19

If a gain of $7,116 is realized in selling (for cash) office equipment having a book value of $64,521, find the total amount reported in the cash flows from investing activities section of the statement of cash flows. Select the correct answer. A. $57,405 B. $71,637 C. $7,116 D. $64,521

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Answers (1)

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Gracie Odonnell · Answer 1

B. $71,637

Explanation:

Investing activities: It records those activities which include purchase and sale of the long term assets i. e intangible assets and the fixed assets. The purchase is an outflow of cash whereas sale is an inflow of cash

The computation of the total amount reported in the investing section is shown below:

= Book value of office equipment + gain realized on the sale of office equipment

= $64,521 + $7,116

= $71,637

Simply we added the book value and the gain realized