A firm purchased $35,000 worth of investments classified as securities available for sale. At the end of the year, the investments were worth $23,000 . What is the correct presentation of these events in the statement of cash flows prepared under the direct method?
a. Investing cash outflow, $35,000
b. Add $23,000 in reconciliation of earnings and net operating cash flow
c. Investing cash outflow, $35,000; subtract $12,000 in reconciliation of earnings and net operating cash flow
d. No disclosure is needed.
A
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