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Provide full debits and credits CASH ACCRUAL OUTFLOW 11 An old factory is reopened and refurbished for 20 in cash 20 20 and the costs

Provide full debits and credits

CASH ACCRUAL
OUTFLOW
11 An old factory is reopened and refurbished for 20 in cash 20 20
and the costs qualify as an EXPENSE
This activity must be recorded in the Income Statement.
INFLOW
12 An old Factory is sold for 60 in cash, at a gain of 30 60 30
The fair value and sales price was 100 100 100
The accumulated depreciation was 40 40 30
The original acquisition cost for the asset was 70 70 70
The net carrying amount of the asset on the books at the time of the sale is (70-40) = 30. The sales price is 60. Therefore the gain on sale is 30.
This GAIN must be recorded in the Income Statement.
OUTFLOW
13 Equipment for the factory is purchased for cash, 50. 10 10
It is an investment or asset purchase. Its deprecciation is
considered included in the Depreciation Expense.
14 An an investment is made in a debt security
It does NOT qualify as a Cash Equivalent. IT will be recognized on the Balance Sheet in the OUTFLOW
Marektable Securities Account. It is purchased for Cash. 30 30
All Marketable Securities are "Available for Sale"

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