Calculate cash flow from operating activities

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Assume the following income statement information:

Sales (all cash) $35

Operating Expenses

Depreciation 10

Income before other Item 25

Other Item

Gain on Sale of Equipment 8

Net Income $33

1. Assume the equipment that was sold for a gain of $8 originally cost $20, had a book value of $4 at the date of disposal, and was sold for $12. Prepare the journal entry to record the disposal. What is the cash effect of this entry?

2. Calculate cash flow from operating activities.

Reference no: EM132203974

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