Bach Company sold an asset with a book value of $59,000

for $120,000 cash. Which of the following is a TRUE statement?

A. Gain on sale equals $120,000 and Cash inflow equals $61,000.

B. Gain on sale equals $61,000 and Cash inflow equals $120,000.

C. Gain on sale equals $120,000 and Cash inflow equals $120,000.

D. Gain on sale equals $59,000 and Cash inflow equals $59,000.

Even though depreciation, depletion, and amortization are expenses, they are considered

non- cash transactions and must be subtracted from net income in the operating activities section of an indirect method cash flow statement.

True or False