Explain How the Following Transactions Should Be Reported in the Statement

question 85

Essay

Explain how the following transactions should be reported in the statement of cash flows,assuming the indirect method is used to determine cash flows from operating activities.Identify all available options.If not reported on the statement of cash flows,indicate the disclosure requirements,if any.
1.The purchase of a $100,000,45-day Treasury bill held-for-trading investment.
2.Amortization of the discount on bonds payable in the amount of $20,000.

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Definitions:

Capital Flight

A large and sudden reduction in the demand for assets located in a country

Interest Rate

The percentage of a loan that is applied as interest for the borrower, usually shown as a yearly rate.

Import Quotas

Restrictions set by a government on the quantity of a specific good that can be imported into a country.

Net Exports

The value of a country's total exports minus the value of its total imports, which is a component of a country's GDP.