Exercise 8-13A Effect of gains and losses on the accounting equation and financial statements LO 8-5 On January 1, Year 1, Prairie Enterprises purchased a parcel of land for $11,300 cash. At the time of purchase, the company planned to use the land for a warehouse site. In Year 3, Prairie Enterprises changed its plans and sold the land. Required a. Assume that the land was sold for $12,543 in Year 3. (1) Show the effect of the sale on the accounting equation. (2) What amount would Prairie report on the Year 3 income statement related to the sale of the land? (3) What amount would Prairie report on the Year 3 statement of cash flows related to the sale of the land? b. Assume that the land was sold for $10,622 in Year 3. (1) Show the effect of the sale on the accounting equation. (2) What amount would Prairie report on the Year 3 income statement related to the sale of the land? (3) What amount would Prairie report on the Year 3 statement of cash flows related to the sale of the land? Reg A1 Req A2 and A3 Req B1 Req B2 and B3 Assume that the land was sold for $12,543 in Year 3. Show the effect of the sale on the accounting equation. (Enter any decreases to account balances with a minus sign.) PRAIRIE ENTERPRISES Year 3 Accounting Equation Stockholders' Equity Land Common Stock Retained Earnings Assets Cash + + Req A1 Req A2 and A3 > Req A1 Req A2 and A3 Req B1 Req B2 and B3 Assume that the land was sold for $12,543 in Year 3. What amount would Prairie report on the Year 3 income statement related to the sale of the land? What amount would Prairie report on the Year 3 statement of cash flows related to the sale of the land? |a-2. of a-3 Req A1 Req A2 and A3 Req B1 Req B2 and B3 Assume that the land was sold for $10,622 in Year 3. Show the effect of the sale on the accounting equation. (Enter any decreases to account balances with a minus sign.) PRAIRIE ENTERPRISES Year 3 Accounting Equation Stockholders' Equity Land Common Stock Retained Earnings Assets Cash + = + Reg A1 Req A2 and A3 Reg B1 Req B2 and B3 Assume that the land was sold for $10,622 in Year 3. What amount would Prairie report on the Year 3 income statement related to the sale of the land? What amount would Prairie report on the Year 3 statement of cash flows related to the sale of the land? b-2. of b-3.