Harp’s Business Machines Inc. reported the following items from its comparative

Question

Harp’s Business Machines Inc. reported the following items from its comparative balance sheet for the calendar year 2008: 2008 2007 Inventory $125,000 $100,000 Land 100,000 200,000 Building 570,000 500,000 Equipment 45,000 30,000 Accumulated depreciation (105,000) (50,000) Notes payable 100,000 150,000 Common stock 300,000 200,000 Additional information for 2008:

1. A piece of land was sold for $65,000, resulting in a $5,000 gain.

2. A smaller section of land was sold for $26,000, resulting in a $14,000 loss.

3. A building was started and completed costing $70,000. All costs were paid in cash.

4. Depreciation expense totaled $55,000 for the year. Required: Determine the cash flows from investing activities for Harp’s Business Machines Inc. for 2008.

Please, help me.

Explanation / Answer

Particulars $ Sale of Land (65000 + 26000) 91,000 Purchase of Building -70,000 Purchase of Equipment -15,000 Cash from investing activities 6,000

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