Question
Following are selected balance sheet accounts of Pharoah Bros. Corp. at December 31, 2020 and 2019, and the increases or decreases in each account from
Following are selected balance sheet accounts of Pharoah Bros. Corp. at December 31, 2020 and 2019, and the increases or decreases in each account from 2019 to 2020. Also presented is selected income statement information for the year ended December 31, 2020, and additional information.
| Selected balance sheet accounts | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| Assets | 2020 | 2019 | Increase (Decrease) | ||||||
| Accounts receivable | $34,100 | $23,900 | $10,200 | ||||||
| Property, plant, and equipment | 277,700 | 247,800 | 29,900 | ||||||
| Accumulated depreciationplant assets | (176,500 | ) | (168,200 | ) | (8,300 | ) | |||
| Liabilities and stockholders equity | 2020 | 2019 | Increase | ||||||
| Bonds payable | $ 49,300 | $46,500 | $2,800 | ||||||
| Dividends payable | 7,900 | 4,900 | 3,000 | ||||||
| Common stock, $1 par | 22,200 | 19,200 | 3,000 | ||||||
| Additional paid-in capital | 9,100 | 3,000 | 6,100 | ||||||
| Retained earnings | 103,800 | 90,500 | 13,300 | ||||||
| Selected income statement information for the year ended December 31, 2020: | |||||||||
| Sales revenue | $156,300 | ||||||||
| Depreciation | 37,700 | ||||||||
| Gain on sale of equipment | 14,700 | ||||||||
| Net income | 31,000 | ||||||||
Additional information:
| 1. | During 2020, equipment costing $45,000 was sold for cash. | |
| 2. | Accounts receivable relate to sales of merchandise. | |
| 3. | During 2020, $20,200 of bonds payable were issued in exchange for property, plant, and equipment. There was no amortization of bond discount or premium. |
Determine the category (operating, investing, or financing) and the amount that should be reported in the statement of cash flows for the following items.
| Activity | ||||||
|---|---|---|---|---|---|---|
| (a) | Payments for purchase of property, plant, and equipment. | select a kind of activityFinancingInvestingOperating FinancingInvestingOperating | $enter a dollar amount | |||
| (b) | Proceeds from the sale of equipment. | select a kind of activityFinancingInvestingOperating FinancingInvestingOperating | $enter a dollar amount | |||
| (c) | Cash dividends paid. | select a kind of activityFinancingInvestingOperating FinancingInvestingOperating | $enter a dollar amount | |||
| (d) | Redemption of bonds payable. | select a kind of activityFinancingInvestingOperating FinancingInvestingOperating | $enter a dollar amount |
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