Question

Geller Florist Inc. had the following transactions during 2015:

Purchased a $200,000 warehouse with $50,000 cash and a $150,000 mortgage from a bank.

Raised $100,000 from selling new shares of stock to investors. The cash was used to buy land to grow tulips.

Sold an old building for $50,000 (and suffered a loss on sale of $5,000) and used the cash to buy a new truck.

What is the net impact of these transactions on Geller's Cash from Investing Activities during 2015?


$(145,000)


$(295,000)


$(50,000)


$(150,000)

Answer 1

Answer:

- $300,000

Explanation:

Net cash flow from investing activities:

= Cash paid for purchasing a warehouse + Cash paid for purchase a land + Cash proceeds from sale of building + Cash paid to buy a new truck

= (- $200,000) + (- $100,000) + $50,000 + (- $50,000)

= (- $300,000)

Therefore, the net impact of these transactions on Geller's Cash from Investing Activities during 2015 is (- $300,000).