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Connect (--) ? Secure ! https://newconnect.mheducation.com/flow/connect.html Help Save & ExitS Chapter 21 Hw 0 Seved Check my 2 Agee Technology, Inc., issued 9% bonds, dated January 1, with million. For bonds of similar risk and maturity, the market yield is 103%. Interest is paid semi a face amount of $1,000 million on July 1, 2018, at a price of $990 annually on June 30 and December 31 What would be the amountfs) related to the bonds that Agee would report in its statement of cash 31, 2018, if it uses the indirect method? (List eny cash outflows with e minus sign. Enter your answer in mil decimal place (i.e., 5,500,000 should be entered as 5.5).) 0.76 points e Book llions 990.0 Cash inflow from financing activities perating Activities: Positive adjustment to net income Print

Explanation / Answer

Answer:

The amount shown in Operating activities : Positive adjustment to net income will be :

Discount on issue of bonds= $ 1,000 - $ 990 = $ 10

As discount is non cash expense it should be added back to net income.

($ in Millions)

Cash flow from financing activities

$ 990

Operating activities : Positive adjustment to net income

$ 10

($ in Millions)

Cash flow from financing activities

$ 990

Operating activities : Positive adjustment to net income

$ 10

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