Under the indirect method,when machinery is sold at a gain,the gain is added in the operating section of the statement of cash flows and the cost is added in the investing section.

Question

Quizplus · Accepted Answer

Under the indirect method, a gain on the sale of machinery is deducted from net income in the operating activities section to reconcile to cash generated from operations, while the entire cash proceeds from the sale are reported in the investing activities section.

Under the Indirect Method,when Machinery Is Sold at a Gain,the