Flow Company has provided the following information for the year ended December 31,2019: • Cash paid for interest,$20,000
• Cash paid for dividends,$6,000
• Cash dividends received,$4,000
• Cash proceeds from bank loan,$29,000
• Cash purchase of treasury stock,$11,000
• Cash paid for equipment purchase,$27,000
• Cash received from issuance of common stock,$37,000
• Cash received from sale of land with a $32,000 book value,$25,000
• Acquisition of land costing $51,000 in exchange for preferred stock issuance
• Payment of a $100,000 note payable by exchanging used machinery with a $77,000 book value and $100,000 fair value
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How much was Flow's net cash flow from investing activities?
A)A net outflow of $2,000.
B)A net inflow of $2,000.
C)A net outflow of $53,000.
D)A net inflow of $49,000.

Question

Quizplus · Accepted Answer

Net cash flow from investing activities includes cash transactions for the purchase and sale of long-term assets. Cash paid for equipment purchase ($27,000) and cash received from the sale of land ($25,000) are the relevant transactions. The net cash flow is $25,000 (inflow) - $27,000 (outflow) = -$2,000, which is a net outflow of $2,000.

Flow Company Has Provided the Following Information for the Year