Treasury stock costing $89,050 was sold for $94,375 cash. Which of the following statements accurately describes the reporting of this transaction within the cash flow statement assuming that the indirect method is used to determine net cash flows from operating activities?
A. There is no adjustment necessary to net income but a $94,375 cash inflow is reported within the financing activities section of the cash flow statement.
B. A gain of $5,325 is deducted from net income and a $94,375 cash inflow is reported within the financing activities section of the cash flow statement.
C. There is no adjustment necessary to net income but a $94,375 cash inflow is reported within the investing activities section of the cash flow statement.
D. A gain of $5,325 is deducted from net income and a $94,375 cash inflow is reported within the investing activities section of the cash flow statement.
Answer: A
You might also like to view...
The three most common ways to obtain documentary evidence which are valuable but difficult to obtain are:
a. subpoena, voluntary consent, and searching public records b. subpoena, search warrant, and voluntary consent c. search warrant, invigilation, and surveillance d. voluntary consent, surveillance, and invigilation
The point of cash receipt for revenue and cash disbursement for expenses is important under the accrual basis when determining income
Indicate whether the statement is true or false
Which one of the following does NOT fit with the functional practitioner role?
A. Provides opportunity for impact on decision–making. B. Uses research to monitor publics and other environmental forces. C. Casts the practitioner in the technician role. D. Employs two–way communication. E. Allows practitioners to fulfill a counseling and management role.
At the beginning of Year 2, Griggs Company had a $64,000 of accounts receivable. During Year 2, Griggs earned revenue on account totaling $336,000. At the end of Year 2, the company had $44,000 of accounts receivable. Required:What was the amount of cash collected from accounts receivable during year 2?
What will be an ideal response?