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erika fernandez
on Nov 13, 2024

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A building with a cost of $153,000 and accumulated depreciation of $42,000 was sold for an $11,000 gain. When using the indirect method, the cash generated from this investing activity is $121,000.

Indirect Method

A method used in cash flow statement preparation that adjusts net income for non-cash transactions, deferrals, and accruals.

Accumulated Depreciation

The total amount of depreciation expense that has been recorded against an asset since it was put into use, reducing its book value.

Investing Activity

Financial transactions related to the acquisition or disposal of long-term assets and investments, reflected in a company's cash flow statement.

  • Comprehend how noncash investing and financing activities are represented in the cash flow statement.
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Zsombor SchüllerNov 14, 2024
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