Below are cash transactions for Goldman Incorporated which p

Below are cash transactions for Goldman Incorporated, which provides consulting services related to mining of precious metals.

a. Cash used for purchase of office supplies, $1,850.
b. Cash provided from consulting to customers, $45,100.
c. Cash used for purchase of mining equipment, $72,000.
d. Cash provided from long-term borrowing, $59,000.
e. Cash used for payment of employee salaries, $23,900.
f. Cash used for payment of office rent, $11,900.
g. Cash provided from sale of equipment purchased in c. above, $22,400.
h. Cash used to repay a portion of the long-term borrowing in d. above, $39,500.
i. Cash used to pay office utilities, $4,200.
j. Purchase of company vehicle, paying $9,900 cash and borrowing $14,900.

Required:

Calculate cash flows from investing activities. (List cash outflows as negative amounts.)

Solution

CASH FLOW FROM INVESTING ACTIVITIES:

Cash flow from investing activities are all cash flows related to purchase and sell of FIXED ASSETS.

c. Cash used for purchase of mining equipment, $72,000.

g.Cash provided from sale of equipment purchased in c. above, $22,400.

j.Purchase of company vehicle, paying $9,900 cash and borrowing $14,900.

Cash used for purchase of mining equipment,

($72,000)

Cash provided from sale of equipment purchased in c. above, $22,400.

$94,400

(72000+22400)

Purchase of company vehicle, paying $9,900 cash and borrowing $14,900.

$ (24,800.)

(9900+14900)

Total Cash Flow for investing activities

($2,400.)

Borrowing of $14,900 will be cash in flow from financing activities and cash outflow in investing activity

Cash flow from investing activities= -$2,400