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In: Accounting

Cameron Corporation purchased land for $263,000. Later in the year, the company sold a different piece of land with a book value of $145,000 for $129,000.

Land Transactions on the Statement of Cash Flows

Cameron Corporation purchased land for $263,000. Later in the year, the company sold a different piece of land with a book value of $145,000 for $129,000.

How are the effects of these transactions reported on the statement of cash flows assuming the indirect method is used? Use the minus sign to indicate cash out flows, cash payments, decreases in cash and for any adjustments, if required. If a transaction has no effect on the statement of cash flows, select "No effect" from the drop down menu and leave the amount box blank.

TransactionsActionAmount
Gain or loss on sale of land?$
Cash received from sale of land?$
Cash paid for purchase of land?$


Property, plant and equipment are considered noncurrent assets. Recall the definitions of each section of the statement of cash flows. What type of an affect would a gain or loss have on the statement of cash flows?

Solutions

Expert Solution

Transactions Action Amount
Gain or loss on sale of land (145000-129000) Added in net income under cash flow from operating activities $16000
Cash received from sale of land Added in Cash flow from investing activities $129000
Cash paid for purchase of land Deducted in Cash flow from investing activities -263000

ekkarill92 answered 2 years ago
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