Exercise 8-13A Effect of gains and losses on the accounting equation and financial statements On January 1, Year 1, Prairie Enterprises purchased a parcel of land for $28,000 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 $29,500 in Year 3 (1) (2) (3) Show the effect of the sale on the accounting equation. 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. Assume that the land was sold for $24,000 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