Free Corporation had the following transactions occur in the current year: 1. Cash sale of merchandise inventory. 2. Sale of delivery truck at book value. 3. Sale of Xanthe common stock for cash. 4. Issuance of a note payable to a bank for cash. 5. Sale of a security held as an available-for-sale investment. 6. Collection of loan receivable.

Respuesta :

Answer:

The requirement was to determine of the listed items would feature under investing activities in cash flows Statement

The correct option is A,3

Explanation:

Sales of truck at book value is a cash inflow under the investing activities the same way purchase of truck would a cash outflow under investing activities.

The sale of security held a an available-for-sale investment is an investing activities inflow same way purchase of such investment would be an investing activities outflow.

Collection of loan receivable is also an investing activities inflow,the loan would have been treated as an outflow when it was made initially.

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