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In: Accounting

The following information on selected cash transactions for 2021 has been provided by Crane Company: Proceeds...

The following information on selected cash transactions for 2021 has been provided by Crane Company:

Proceeds from sale of land $311000
Proceeds from long-term borrowings 606000
Purchases of plant assets 212000
Purchases of inventories 1015000
Proceeds from sale of Crane common stock 368000


What is the cash provided (used) by investing activities for the year ended December 31, 2021, as a result of the above information?

$99000.
$311000.
$1285000.
$394000.

Solutions

Expert Solution

Correct Answer for this question is First Option : $99,000
Particulars Amount
Proceeds from the sale of land $       3,11,000
Less : Purchase of plnat assets $       2,12,000
Net cash inflow from investing activities $           99,000
Note: Investing activities will be showing how much money has been used
Investment activities include the purchase & sale of property,plant&equipment,
acquisitions of any other business or companies, sale of other business and
so on.
Here in the scenario, proceeds from long term borrowings and proceeds from the issue of common
stock is cash flow from financing activities.
Purchase of inventories is operating activity as it is a part of day tom day operations of the business
and it is not an investment for the company.

ekkarill92 answered 2 years ago
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