The Activity from the Long-Term Investments Account for Fisk Corporation $\text { Long-Term Investments }$

question 108

Essay

The activity from the Long-Term Investments account for Fisk Corporation appears below.In addition,the income statement shows a loss on the sale of investments of $32,000.
$\text { Long-Term Investments }$
$\begin{array}{|lr|}\hline\text { Beginning balance, } 2009 & \$ 184,000 \\\text { Purchases } & 278,000 \\\text { Sales } & (202,000) \\\text { Ending balance, } 2009 & \$ 260,000 \\\hline\end{array}$
Based on the information given,compute the amounts to be shown and indicate how they would appear on the statement of cash flows.Assume that the indirect method is being used and that the investments were purchased for cash.

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Definitions:

Average Variable Costs

Costs that vary with the level of output, calculated by dividing the total variable costs by the quantity of output produced.

Shutting-Down

A short-run decision by a firm to halt production because operating would lead to a loss greater than the fixed costs.

Hostages

Individuals held captive by others as security for the fulfillment of specific conditions or demands.

Trading Partner

An entity or country that engages in commerce or trade with another, often under agreed terms or through treaties.