Answer the following question:

Part A:

The following item is found on the income statement of MF Communications corporation: Loss on sale of equipment, $3,000. The equipment sold during the year originally cost $20,000, had accumulated depreciation of $16,000 and was sold for cash. The Statement of Cash Flows should show an inflow of cash from investing activities of: (Explain answer)

a) $4,000

b) None of these are correct

c) $9,000

d) $1,000

e) $5,000

Part B:

The lower of cost or NRV (LOCON) value is to be applied to the following scenario at Andreyevich Inc. The controller would like your advice on what the value of one unit in inventory should be valued at: (Explain answer)

Cost: $12

Sale price: $15

Replacement cost: $12

Net realizable value: $13

a) $9.50

b) None of the choices

c) $13.00

d) $9.00

e) $12.00

Part C:

The following information is available for Nikolaevich Inc. What is the estimated gross margin rate? (Explain answer)

Gross sales $4,300,500

Beginning inventory at cost $233,000

Estimated gross margin: $113,200

a) $4,300,500 (4,300,500 113,200) divided by 113,500

b) $4,300,500 (4,300,500 + 233,000) divided by 4,300,500

c) $4,300,500 (4,300,500 233,000) divided by 4,300,500

d) $113,200 divided by $4,300,500

e) $4,300,500 divided by $113,200