The following information has been taken from the consolidation worksheet of Graham Company and its 80% owned subsidiary, Stage Company.

(1.) Graham reports a loss on sale of land (to an outside party) of $5,000. The land cost Graham $20,000.

(2.) Noncontrolling interest in Stage's net income was $30,000.

(3.) Graham paid dividends of $15,000.

(4.) Stage paid dividends of $10,000.

(5.) Excess acquisition-date fair value over book value amortization was $6,000.

(6.) Consolidated accounts receivable decreased by $8,000.

(7.) Consolidated accounts payable decreased by $7,000.

How is the loss on sale of land reported on the consolidated statement of cash flows?

Multiple Choice

• $20,000 added to net income as an operating activity.

• $20,000 deducted from net income as an operating activity.

• $15,000 deducted from net income as an operating activity.

• $5,000 added to net income as an operating activity.

• $5,000 deducted from net income as an operating activity.