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Waterway Corporation engaged in the following cash transactions during 2017. Sale of land and building $195,800 Purchase of treasury stock 41,500 Purchase of land 43,000 Payment of cash dividend 87,800 Purchase of equipment 57,900 Issuance of common stock 149,100 Retirement of bonds 101,300 Compute the net cash provided (used) by investing activities. (Show amounts that decrease cash flow with either a - sign e.g. -15,0

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Answer:

The Following transactions results in cash flows for investing activities:

Sale of Land and Building      195,800

Purchase of Treasury Stock   -41,500

Purchase of land                    -43,000.

Purchase of equipment         -57,900

Net cash provided by investing activities = 53,400

Explanation:

Cash flow from investing activities is a section in cash flow statement that provides information to company as how much cash is generated or spent in related to different investment related activities of a business.

For example: Purchase of physical assets, Sale of physical assets, investment in or sale of securities.

  • Payment of cash dividend is a financing activity so not included in calculations.
  • Issuance of common stock is a financing activity in cash flow statement.
  • Retirement of bonds is also a financing activity so excluded in calculations.    

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