Illinois Woodworking Company Is Preparing Its Statement of Cash Flows

question 140

Multiple Choice

Illinois Woodworking Company is preparing its statement of cash flows using the indirect method.During the year,Illinois Woodworking sold equipment for $5990 cash.The net book value of the asset was $4970.Which of the following statements is TRUE?

• A) The gain on sale of $1020 is added back to net income in the operating activities section.
• B) The book value of the asset sold is shown as a negative cash flow in the investing activities section.
• C) The cash receipt of $5990 is shown as a positive cash flow in the investing activities section.
• D) The gain on sale of $1020 is shown as a positive cash flow in the financing activities section.

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Definitions:

Equal Employment Opportunity

Policies and regulations that ensure all individuals have an equal chance for employment, regardless of race, color, religion, sex, nationality, age, disability, or any other non-merit factor.

Union Substitution

Strategies employers use to address and mitigate worker demands and grievances without union involvement.

Unionized Plants

Factories or workplaces where the employees are represented by a union for collective bargaining with the management.

Labor Market

The supply of available workers in relation to available employment.