Investing activities relate to cash flows from the sale or purchase of non-current assets. Cash inflows come from selling non-current assets, while cash outflows result from buying non-current assets. A cash flow statement example is provided for the month ended June 30, 2015, which shows a net cash outflow from investing activities of $2,000, with cash inflows of $6,500 from selling equipment and furniture, and cash outflows of $8,500 for purchasing a computer and vehicle.

1. 12.6
INVESTING ACTIVITIES

2. © Michael Allison, Trinity Grammar School.
Author’s permission required for external use
12.6 INVESTING ACTIVITIES
Investing activities
Cash flows relating to the sale or purchase of non-current
assets
• Cash inflows from selling non-current assets
• Cash outflows from buying non-current assets

3. © Michael Allison, Trinity Grammar School.
Author’s permission required for external use
Investing Activities
 It is acceptable to have either
a POSITIVE or NEGATIVE net
cash flow from Investing
Activities
 A POSITIVE net cash flow is
not necessarily good
because the firm has sold
non-current assets which
can’t be used in the future
to earn revenue
 A NEGATIVE net cash flow is
not necessarily bad because
the firm has invested in non-
current assets which can be
used to generate revenue in
the future
12.6 INVESTING ACTIVITIES
Cash Flow Statement for the month ended 30 June 2015
$ $
Cash Flows from Investing Activities
Sale of office equipment 2000
Sale of furniture 4500
Purchase of computer (3000)
Purchase of vehicle (5500)
Net Cash Flow from Investing Activities (2000)

4. © Michael Allison, Trinity Grammar School.
Author’s permission required for external use
Cash Flow Statement for the month ended 30 June 2015
$ $
Cash Flows from Investing Activities
Sale of office equipment 2000
Sale of furniture 4500
Purchase of computer (3000)
Purchase of vehicle (5500)
Net Cash Flow from Investing Activities (2000)
Cash Flow Statement for the month ended 30 June 2015
$ $
Cash Flows from Investing Activities
Sale of office equipment 2000
Sale of furniture 4500
Purchase of computer (3000)
Purchase of vehicle (5500)
Net Cash Flow from Investing Activities (2000)
Cash Flow Statement for the month ended 30 June 2015
$ $
Cash Flows from Investing Activities
Sale of office equipment 2000
Sale of furniture 4500
Purchase of computer (3000)
Purchase of vehicle (5500)
Net Cash Flow from Investing Activities (2000)
Cash Flow Statement for the month ended 30 June 2015
$ $
Cash Flows from Investing Activities
Sale of office equipment 2000
Sale of furniture 4500
Purchase of computer (3000)
Purchase of vehicle (5500)
Net Cash Flow from Investing Activities (2000)
Section heading
Cash inflows
Listed before
outflows in 1st
column
Cash outflows
Listed after
inflows in 1st
column
Section ending
Listed in 2nd
column and
down a row
12.6 INVESTING ACTIVITIES

5. © Michael Allison, Trinity Grammar School.
Author’s permission required for external use
TASK
In-class Homework
Ex12.3 X
Ex12.4 X