Use the following information for questions 16-17.
Oswald Ltd. has recently decided to go public and has hired you as their independent accountant. They wish to adhere to IFRS and know that they must prepare a statement of cash flows. Their financial statements for 2020 and 2019 are provided below: The following additional data were provided for calendar 2020:
1. Dividends declared and paid were $ 24,000.
2. Equipment was sold for $ 30,000. This equipment originally cost $ 44,000, and had a book value of $ 36,000 at the time of sale. The loss on sale was included in "selling and administrative expenses," as was the depreciation expense for the year.
3. Bonds were retired during the year at par.
-On a statement of cash flows for calendar 2020, the cash provided by (used in) investing activities is
A) $ 6,000.
B) $ 30,000.
C) $ (36,000).
D) $ (44,000).

Question

Use the following information for questions 16-17.
Oswald Ltd. has recently decided to go public and has hired you as their independent accountant. They wish to adhere to IFRS and know that they must prepare a statement of cash flows. Their financial statements for 2020 and 2019 are provided below:  The following additional data were provided for calendar 2020:
1. Dividends declared and paid were $ 24,000.
2. Equipment was sold for $ 30,000. This equipment originally cost $ 44,000, and had a book value of $ 36,000 at the time of sale. The loss on sale was included in "selling and administrative expenses," as was the depreciation expense for the year.
3. Bonds were retired during the year at par.
-On a statement of cash flows for calendar 2020, the cash provided by (used in) investing activities is
A) $ 6,000. 
B) $ 30,000. 
C) $ (36,000). 
D) $ (44,000).

Quizplus · Accepted Answer

Cash provided by investing activities is calculated as:
Cash inflow from sale of equipment = $30,000
Cash outflow from purchase of land and building = $0
Net cash flow from investing activities = $30,000 - $0 = $30,000.

Use the Following Information for Questions 16-17