Here is the question: During 2012, Company X sold a tee shit making machine for a gain of $50,000. The machinery had an original cost of $250,000 and its accumulated depreciation was $100,000.
I was thinking CFI would just be the 50k because that is the cash received but the book value of 150k (250k - 100k) is also included so the CFI = 200k. Can you explain why book value is included if it is not cash?
I was thinking CFI would just be the 50k because that is the cash received but the book value of 150k (250k - 100k) is also included so the CFI = 200k. Can you explain why book value is included if it is not cash?