Asked by Dolly Rodriguez on May 14, 2024
Verified
If an entity both sells capital assets and purchases capital assets during the year, only the net cash inflow or outflow will be reported in the investing section of the cash flow statement.
Cash Flow Statement
A financial statement that shows how changes in balance sheet accounts and income affect cash and cash equivalents, breaking the analysis down to operating, investing, and financing activities.
Investing Section
A part of a company's cash flow statement that shows the cash spent on or generated from investment activities, such as purchasing physical assets or securities.
Capital Assets
Long-term assets acquired for operation and not for resale, typically including buildings, machinery, and equipment.
- Understand the preparation and reporting of cash flows from investing activities, including the treatment of sales and purchases of capital assets.
Verified Answer
Learning Objectives
- Understand the preparation and reporting of cash flows from investing activities, including the treatment of sales and purchases of capital assets.
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