If a loss of $20,000 is incurred in selling (for cash)office equipment that cost $90,000 and had accumulated depreciation of $22,500,the total amount reported in the investing activities section of the statement of cash flows is
A)$70,000.
B)$67,500.
C)$47,500.
D)$87,500.

Question

Quizplus · Accepted Answer

The total amount reported in the investing activities section of the statement of cash flows is equal to the cash proceeds received from the sale of the office equipment.

To calculate the cash proceeds, we need to deduct the loss on the sale from the selling price:

Selling price = $90,000 - $22,500 = $67,500 
Cash proceeds = selling price - loss on sale = $67,500 - $20,000 = $47,500

Therefore, the answer is C) $47,500.

If a Loss of $20,000 Is Incurred in Selling (For