Cash received from the sale of fixed assets

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Investing activities usually involve activities that affect long-term assets.

Cash received from the sale of fixed assets is an example of cash flows from investing activities.

The cash flows from investing activities section in the statement of cash flows captures the cash inflows and outflows related to the acquisition and disposal of long-term assets, such as property, plant, and equipment. It includes cash transactions that involve the purchase or sale of fixed assets, investments in securities (other than cash equivalents), and loans made to other entities.

When a company sells a fixed asset, such as land, buildings, or machinery, it receives cash as a result of the transaction. This cash inflow is categorized as a cash flow from investing activities because it represents a cash inflow resulting from the sale of a long-term asset. The sale of fixed assets is considered an investing activity because it involves the disposal of a noncurrent asset that was used in the company's operations.

The cash flows from investing activities section is important because it provides insights into the company's capital expenditures and investments. By analyzing this section, investors and analysts can evaluate the company's ability to generate cash from its investment activities and assess its capital allocation decisions.

In summary, cash received from the sale of fixed assets is classified as cash flows from investing activities in the statement of cash flows.