Question
On January 1, Year 1, Prairie Enterprises purchased a parcel of land for $11,200 cash. At the time of purchase, the company planned to use
On January 1, Year 1, Prairie Enterprises purchased a parcel of land for $11,200 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 $12,432 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 $10,528 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?
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Managerial Accounting Tools For Business Decision Making Wileyplus Lms Student Package
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
8th Edition
1119390249, 978-1119390244
