The Three Accounts Shown Below Appear in the General Ledger

question 68

Essay

The three accounts shown below appear in the general ledger of Glaus Corp. during 2014. Instructions
From the postings in the accounts, indicate how the information is reported on a statement of cash flows using the indirect method. The loss on sale of equipment was $5,000. (Hint: Cost of equipment constructed is reported in the investing activities section as a decrease in cash of $58,000.)

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Definitions:

Voidable

A term referring to a valid agreement that may be legally declared invalid by one of the parties.

Mutual Mistake

A misunderstanding shared by all parties to a contract, causing a fundamental misbelief about a vital fact of the agreement.

Duress

The use of force, pressure, or threats to compel someone to act against their will or better judgment in concluding a contract or performing an act.

Improper Threats

Coercive actions or statements intending to force someone into an agreement or decision against their will, often considered unlawful.