Question

In Jude Company, land decreased $150,000 because of a cash sale for $150,000, the equipment account increased $60,000 as a result of a cash purchase, and Bonds Payable increased $120,000 from issuance for cash at face value. The net cash provided by investing activities is?

Answer 1

The net cash provided by investing activities is $90,000

Explanation:

In this question, we are asked to calculate the net cash that is provided by investing activities.

To calculate the net cash provided by investing activities, we simply subtract the cash used to purchase equipment from cash from sale of land.

Mathematically, net cash provided by investing activities = cash from sale of land - cash used to purchase equipment.

From the question, we can identify that cash from sale of land is $150,000 while cash used to purchase equipment is $90,000

We substitute these and get; $150,000 -$60,000 = $90,000