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Investments that cost $80,000 were sold at a $10,000 gain. What was the cash inflow from the sale?
A$80,000
B$70,000
C$90,000
D$10,000
Answer & Solution
Correct answer: C. $90,000
1. When a sale produces a gain, cash received = cost + gain.
2. Cash inflow = $80,000 + $10,000 = $90,000.
3. Trap: $70,000 (option B) subtracts the gain, which is the rule for a loss, not a gain.
_Source: Jonick, Principles of Financial Accounting (CC BY-SA 4.0), §7.2.3 "Investing Activities Section", p.274_
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