The Jones and Brown medical practice bought new equipment for a total price of $50,000. The...
The Jones and Brown medical practice bought new equipment for a total price of $50,000. The old equipment that was being replaced was traded in on the new equipment. The seller allowed $10,000 for the equipment that was traded in. What is the resulting Jones and Brown cumulative cash flow?
A) $60,000
B) $50,000
C) $40,000
D) $10,000
Homework Answers
Solution:
Cumulative cash flow = total price of new equipment - trade value of old equipment
= $50000 - $10000
= $40,000
Hence option "C" is correct.
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