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Social ScienceReporting Land Transactions on Statement of Cash FlowsOn the basis of the details of the following fixed asset account, indicate the items to be reported on the statement of cash flows:ACCOUNT LandACCOUNT NO. BalanceDateItemDebitCreditDebitCreditJan.1 Balance 1,296,000 Mar.12 Purchased for cash389,000 1,685,000 Oct.4 Sold for $214,000 183,000 1,502,000 ItemSection of Statement ofCash FlowsAdded or DeductedAmountMar. 12: Purchase of fixed assetInvesting activities section Deducted $Oct. 4: Sale of fixed assetInvesting activities section Added $Gain on sale of fixed asset (assume the indirect method)Operating activities section Deducted $
Reporting Land Transactions on Statement of Cash Flows
On the basis of the details of the following fixed asset account, indicate the items to be reported on the statement of cash flows:
| ACCOUNT Land | ACCOUNT NO. | |||||||||
| Balance | ||||||||||
| Date | Item | Debit | Credit | Debit | Credit | |||||
| Jan. | 1 | Balance | 1,296,000 | |||||||
| Mar. | 12 | Purchased for cash | 389,000 | 1,685,000 | ||||||
| Oct. | 4 | Sold for $214,000 | 183,000 | 1,502,000 |
| Item | Section of Statement of Cash Flows |
Added or Deducted | Amount |
| Mar. 12: Purchase of fixed asset | Investing activities section | Deducted | $ |
| Oct. 4: Sale of fixed asset | Investing activities section | Added | $ |
| Gain on sale of fixed asset (assume the indirect method) | Operating activities section | Deducted | $ |
Expert Answer
Statement of cash flows: This statement reports all the cash transactions which are responsible for inflow and outflow of cash, and result of these transactions is reported as ending balance of cash at the end of reported period. Statement of cash flows includes the changes in cash balance due to operating, investing, and financing activities. Operating activities include cash inflows and outflows from business operations. Investing activities includes cash inflows and cash outflows from purchase and sale of land or equipment, or investments. Financing activities includes cash inflows and outflows from issuance of common stock and debt, payment of debt and dividends.
Indicate the items to be reported on the sta...
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Section of Statement Added or Item Amount Deducted of Cash Flows Investing activities section March 12: Purchase of fixed asset Deducted $389,000 Investing activities section October 4: Sale of fixed asset Added $214,000 Operating activities section Gain on sale of fixed asset Deducted $31,000
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