Question

A flood damaged a building and contents. Floods are unusual and infrequent in this area. The receipts from insurance companies totaled $500,000, which was $150,000 less than the book values. The tax rate is 30%. On the statement of cash flows (indirect method), the receipts from insurance companies should

Answer 1

Answer:

It is shown under investing activities as a cash inflow

Explanation:

On the cash flow statement using the indirect method the receipts from the insurance company should be shown in the investing activities at $500,000

as an inflow of cash as the cash is increased

So the same is to be considered

The other $150,000 would be ignored as it is not relevant

Therefore the above is the answer