Perez Construction Inc. provided the following information about the sale of property, plant, and equipment during two recent years:

Required:
1. Determine the cash flow from the sale of equipment that would be reported in the investing activities section of the statement of cash flows for each year.
2. Perez uses the indirect method for the operating activities section of the statement of cash flows. What amounts related to the sale of equipment would be added or subtracted in the computation of net cash flows from operating activities for each year?

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Year 1 Year 2 Property, plant, and equipment (at cost) Accumulated depreciation on $75,000 $13,500 equipment disposed of Gain (loss) on sale 40,385 (16,751) 3,773 2.436