The Wall Street Journal (June 12, 1995) reported that Westinghouse reached an agreement to sell all of its real estate operations for about $550 million, which is estimated to be approxi¬ mately book value. The assets of this operation are valued at $718 million, and the proceeds from the sale were “expected to be used to reduce debt at Westinghouse.” REQUIRED:

a. Explain how the transaction would affect the balance sheet and income statement and be reported in the statement of cash flows.

b. How much debt was associated with the real estate operations?

c. In that same issue of The Wall Street Journal, American Telecasting Inc. was reportedly raising $100 million through an equity issuance, “which would be used to . . . build . . . wireless cable systems.” How would these transactions be reported in the statement of cash flows?