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what is the effect on cash flow if I disposed an investment at cost but the proceed for the said disposal is yet to be received at the reporting date. My balance sheet already reflected the disposal of investment and a receivable to that effect.
Hi,
If you haven’t received the cash then there will be no cash flow in investing activities and the receivable balance will be adjusted through operating activities using the indirect method as usual. There would also be a profit/loss on disposal to adjust for too.
I doubt you would see this in an exam though a it hasn’t been seen previously.
Thanks
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