Pan-Atlantic Shipping Co. has accumulated the following information:

Property, Plant & Equipment Accounts at 01/01/2019

Land $10,000

Buildings and equipment $48,000

Accumulated depreciation ($15,000)

Net $33,000

Total $43,000

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Investing Activities from SCF for 2019

Sale of building (historical cost = $10,000) $8,000

Purchase of land ?

Purchase of building and equipment ($30,000)

Net cash used by investing activities ($40,000)

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Selected Accounts from the 2019 Income Statement

Depreciation expense $11,000

Gain on sale on building $4,000

Cost of goods sold $107,200

Required:

1. How much was paid for the land acquired in 2019?

2. How was the gain on sale of the building determined? Show calculations.

3. How is the gain on the sale of the building treated on the Statement of Cash Flows?

4. Determine the adjusted balances for all property, plant, and equipment accounts at

December 31, 2019. Suggestion: Use T Accounts.