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Cash flow statement
Why loss on sale of fixed asset is added in the net profit in cash flow statement.
Replies (2)
Bcz it did not rslts in outflow of cash...
Firstly u should knw the purpose of CFS...
Loss on Sale of Fixed Asset is a non-cash item.We add it to the net profit to reach to the net cash from operating activities.The actual cash inflow from sale of fixed asset is shown in "cash flow from Investing activities".
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