Question 1

Prorok Music Inc. decides to sell an old piece of equipment and receives $5,000 cash for it. The original cost of the equipment was $50,000 and it had accumulated depreciation of $47,000 associated with it.

Which of the following items would be increased by the sale of the old equipment? (check all that apply)

Net Income

Cash from Investing Activities

Gain on Sale

Accumulated Other Comprehensive Income

Equipment

Question 2

In 2010, Stohs Seafood Inc. acquired Boychuk Barbies Ltd. in a hostile takeover. However, the expected synergies never materialized. In 2013, Stohs decided to write-off $45 million of Goodwill on the financial statements to recognize that the Goodwill had become impaired.

Which of the following items would be decreased by the impairment of Goodwill? (check all that apply)

Total Assets

Total Shareholders