or-assignment-take&inprogress-; false eBook Cash Flows from Investing Activities

Question

or-assignment-take&inprogress-; false eBook Cash Flows from Investing Activities During the year, equipment with a book value of $125,000 was sold for $175,000 (original purchase cost of $225,000). New equipment was purchased Murray Company provided the following comparative balance sheets: Murray Company Comparative Balance Sheets At December 31, 2015 and 2016 Long-Term Assets Plant and equipment Accumulated depreciation 2015 2016 $1,000,000 $1,025,000 (500.000) (525,000) 500,000702,750 Land Required: Calculate the investing cash flows for the current year. Use a minus sign to indicate a cash outflow. KPy Next 6 8

Explanation / Answer

Calculation of investing cash flows for the current year Sale of Equipment $175,000 Purchase of Equipment -$250,000 Purchase of Land -$202,750 Investing Cash flows for the Current Year -$277,750 Working Calculation of Cost of Purchased Equipment during the year Plant and equipment balance on 2016 $1,025,000 Add : Cost of sold equipment $225,000 Less : Plant and equipment balance on 2015 $1,000,000 Cost of Purchased Equipment $250,000

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