2. Avatar Company uses the indirect method to prepare its statement of cash flow

Question

2. Avatar Company uses the indirect method to prepare its statement of cash flows. Please refer to the following portion of the comparative balance sheet: Cash Accounts receivable | Inventory PP&E;, net Total assets 2014 2013 Increase/decrease $ 21,000 $ 18,000 $ 3,000 31,000 35,000 (4,000) 53,000 25,000 28,000 120,000 90,000 (30,000 $225,000 $168,000 $57,000 Additional information provided: Equipment costing $52,000 was purchased for cash. Equipment with a net asset value of $10,000 was sold for $14,000. Depreciation expense of $12,000 was recorded during the year. What was the net amount of Cash from investing activities?

Explanation / Answer

Cash flow from investing activities: Purchase of equipment $ -52,000.00 Sale of equipment $   14,000.00 Net cash used by investing activities $ -38,000.00

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