SURVEY OF ACCOUNTING(LL)>CUSTOM PKG.<
5th Edition
ISBN: 9781264010653
Author: Edmonds
Publisher: MCGRAW-HILL HIGHER EDUCATION
expand_more
expand_more
format_list_bulleted
Concept explainers
Textbook Question
Chapter 1, Problem 20E
Riley Company paid $60,000 cash to purchase land from Smally Company in 2018. Smally originally paid $60,000 for the land.
Required
- a. Was this event an asset source, use, or exchange transaction for Riley Company?
- b. Was this event an asset source, use, or exchange transaction for Smally Company?
- c. Was the cash flow an operating, investing, or financing activity on Riley Company’s 2018 statement of cash flows?
- d. Was the cash flow an operating, investing, or financing activity on Smally Company’s 2018 statement of cash flows?
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
Using a spreadsheet to prepare the statement of cash flows—indirect method
The 2018 comparative balance sheet and income statement of Attleboro Group, Inc. follow. Attleboro disposed of a plant asset at book value in 2018.
Prepare the spreadsheet for the 2018 statement of cash flows. Format cash flows from operating activities by the indirect method. A plant asset was disposed of for $0. The cost and accumulated depreciation of the disposed asset was $13,600. There were no sales of land, no retirement of common stock, and no treasury stock transactions. Assume plant asset and land acquisitions were for cash.
Inserting into the Answer Box, prepare a statement of cash flows for the year ended December 31, 2019, using the Indirect method for Presidio, Co.
Extracts from the 2019 financial records of the Presidio, Co.:
Additional information:
During 2019, the company sold a piece of plant equipment for cash that had originally cost $20,000. The accumulated depreciation associated with the equipment at the time of sale was $10,000. There was no gain or loss on the sale.
A Long-Term Stock Investment with an original cost of $11,000 was sold.
All dividends were paid in cash during the year.
Copy and Paste the Statement template below INTO your Answer Box in order to complete this question in the correct format.
Cash flows from operating activities:
Cash flows from investing activities:
Cash flows from financing activities:
Net increase/<decrease> in cash & cash equivalents
Beginning cash balance, January 1, 2019…
On July 15, 2021, M.W. Morgan Distribution sold land for $49.2 million that it had purchased in 2016 for $42.0 million.Required: What would be the amount(s) related to the sale that Morgan would report in its statement of cash flows for the year ended December 31, 2021, using the direct method? The indirect method?
Chapter 1 Solutions
SURVEY OF ACCOUNTING(LL)>CUSTOM PKG.<
Ch. 1 - Prob. 1QCh. 1 - Prob. 2QCh. 1 - Prob. 3QCh. 1 - 4. In a business context, what does the term...Ch. 1 - 5. What market trilogy components are involved in...Ch. 1 - 6. Give an example of a financial resource, a...Ch. 1 - Prob. 7QCh. 1 - 8. How do financial and managerial accounting...Ch. 1 - Prob. 9QCh. 1 - Prob. 10Q
Ch. 1 - Prob. 11QCh. 1 - 12. Distinguish between elements of financial...Ch. 1 - Prob. 13QCh. 1 - 14. To whom do the assets of a business belong?Ch. 1 - 15. Describe the differences between creditors and...Ch. 1 - Prob. 16QCh. 1 - Prob. 17QCh. 1 - Prob. 18QCh. 1 - 19. What does a double-entry bookkeeping system...Ch. 1 - 22. How does acquiring capital from owners affect...Ch. 1 - Prob. 21QCh. 1 - Prob. 22QCh. 1 - 25. What are the three primary sources of assets?Ch. 1 - 26. What is the source of retained earnings?Ch. 1 - 27. How does distributing assets (paying...Ch. 1 - 28. What are the similarities and differences...Ch. 1 - Prob. 27QCh. 1 - 30. Which of the general-purpose financial...Ch. 1 - 31. What causes a net loss?Ch. 1 - 35. What three categories of cash receipts and...Ch. 1 - Prob. 31QCh. 1 - 37. Discuss the term articulation as it relates to...Ch. 1 - 38. How do temporary accounts differ from...Ch. 1 - Prob. 34QCh. 1 - 41. Identify the three types of accounting...Ch. 1 - Prob. 36QCh. 1 - Prob. 37QCh. 1 - Prob. 1ECh. 1 - Prob. 2ECh. 1 - Exercise 1-3A Identifying the reporting entities...Ch. 1 - Exercise 1-4A Define Terms and Identify Missing...Ch. 1 - Exercise 1-5 Effect of events on the accounting...Ch. 1 - Exercise 1-6 Effect of transactions on general...Ch. 1 - Exercise 1-7 Missing information and recording...Ch. 1 - Prob. 8ECh. 1 - Exercise 1-9A Record events and interpret...Ch. 1 - Exercise 1-10 Interpreting the accounting equation...Ch. 1 - Prob. 11ECh. 1 - Exercise 1-12A Differences between interest and...Ch. 1 - Exercise 1-13A Classifying events as asset source,...Ch. 1 - Prob. 14ECh. 1 - Exercise 1-15 Preparing an income statement and a...Ch. 1 - Prob. 16ECh. 1 - Prob. 17ECh. 1 - Prob. 18ECh. 1 - Prob. 19ECh. 1 - Riley Company paid 60,000 cash to purchase land...Ch. 1 - Prob. 21ECh. 1 - As of January 1, 2018, Room Designs, Inc. had a...Ch. 1 - As of December 31, 2018, Flowers Company had total...Ch. 1 - Prob. 24ECh. 1 - Critz Company was started on January 1, 2018....Ch. 1 - The Candle Shop experienced the following events...Ch. 1 - Prob. 27ECh. 1 - Prob. 28PCh. 1 - Prob. 29PCh. 1 - Match the terms (identified as a through r) with...Ch. 1 - Problem 1-30A Classifying events as asset source,...Ch. 1 - Problem 1-31A Relating titles and accounts to...Ch. 1 - Marks Consulting experienced the following...Ch. 1 - Prat Corp. started the 2018 accounting period with...Ch. 1 - Maben Company was started on January 1, 2018, and...Ch. 1 - Required Use the Target Corporations Form 10-K to...Ch. 1 - ATC 1-5 Writing Assignment Elements of financial...
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Use the following information from Dubuque Companys financial statements to prepare the operating activities section of the statement of cash flows (indirect method) for the year 2018.arrow_forwardThe following information on selected cash transactions for 2021 has been provided by Crane Company: Proceeds from sale of land $310000 Proceeds from long-term borrowings 590000 Purchases of plant assets 210000 Purchases of inventories 1010000 Proceeds from sale of Crane common stock 350000 What is the cash provided (used) by investing activities for the year ended December 31, 2021, as a result of the above information? $310000. $380000. $1250000. $100000.arrow_forwardAngel Corporation's accounting records and financial statements for 2021is as follows (P in millions): Cash paid to acquire machinery = P32; Retiredshare capital = P51; Proceeds from sale of land = P95; Gain from the saleof land = P50; Investment revenue received = P72; Cash paid to acquireoffice equipment = P85. In its statement of cash flows, the companyshould report net cash flows from investing activities of: A. P22 million outflowsB. P50 million outflowsC. P100 million inflowsD. P28 million inflowsarrow_forward
- On July 15, 2021, M.W. Morgan Distribution sold land for $35 million that it had purchased in 2016 for $22 million. What would be the amount(s) related to the sale that Morgan would report in its statement of cash flows for the year ended December 31, 2021, using the direct method? The indirect method?arrow_forwardof Take me to the text Squash Incorporated had net income for 2023 of $382,000. Included on the income statement was a loss on sale of equipment of $4,900, a gain on sale of investments of $16,300, depreciation of $7,300, loss on retirement of debt of $10,600, and interest of $3,200. Calculate the net cash provided (used) by operating activities using the indirect method Assume that the balances of current assets (except cash) and current liabilities remain the same as last year. Do not enter dollar signs or commas in the input boxes. Use the negative sign for a decrease in cash. Net cash provided (used) by operating activities $-385400 Check *arrow_forwardBelow are the most recent balance sheets for Country Kettles, Incorporated. Excluding accumulated depreciation, determine whether each item is a source or a use of cash, and the amount. (Input all amounts as positive values.) Assets Cash COUNTRY KETTLES, INCORPORATED Balance Sheets 2019 $ 30,900 70,400 61,300 152,000 46,320 Accounts receivable Inventories Property, plant, and equipment Less: Accumulated depreciation Total assets Liabilities and Equity Accounts payable Accrued expenses Long-term debt Common stock Item Cash Accounts receivable Inventories Property, plant, and equipment Accounts payable $ 47,540 6,020 26,100 28,750 21,000 25,500 Accumulated retained earnings 169,000 170,610 Total liabilities and equity $ 268,280 $278,420 Accrued expenses Long-term debt Common stock Accumulated retained earnings 2020 $ 30,040 73,480 $ 268,280 $278,420 $ 45,400 6,780 63,500 161,800 50,400 Source/Use Amountarrow_forward
- Use the information provided below to prepare the Cash Flow Statement of Chelsea Limited for the year ended 31 December 2021 using the answer template provided (see images) Additional information: (See images)¦ Selling and administrative expenses include depreciation as follows:Depreciation on buildings R96 000Depreciation on plant and machinery R160 000¦ There were purchases but no disposals of property, plant and equipment for the financial year ended 31 December2021.¦ Total dividends for the year ended 31 December 2021 and 31 December 2020 amounted toR288 000 and R388 000 respectively.¦ Inventories on 31 December 2019 amounted to R560 000.¦ All purchases and sales of inventories were on credit.¦ The number of shares in issue was 400 000.¦ Credit terms from creditors are 90 days.arrow_forwardHow do you find "Cash Payment for Acquisition of Plant Assets"? Requirement 1. Prepare the 2024 Statement of Cash Flows by the direct method. (Use a minus sign or parentheses for amounts that result in a decrease in cash. If a box is not used in the statement, leave the box empty; do not select a label or enter a zero.) Complete the statement one section at a time, beginning with the cash flows from operating activities. Sweet Valley, Inc. Statement of Cash Flows Year Ended December 31, 2024 Cash Flows from Operating Activities: Receipts: Collections From Customers $443,700 Interest Received $8,200 Total Cash Receipts $451,900 Payments: To Suppliers (197,700) To Employees (77,400) For Interest (21,100) For Income Tax (19,400)…arrow_forwardPrepare the company's statement of cash flows indirect method for the year ended December 31, 2024. Assume investments are purchased with cash. (Use a minus sign or parentheses for amounts that result in a decrease in cash. It a box is not used in the statement leave the box empty; do not select a label or enter a zero.) More info Superior calculated the following amounts for 2024: • Acquisition value of plant assets, $89,000. • Payment of dividends, $102,000. • Payment of long-term notes payable, $3,000. • Cash receipt from issuance of common stock. $15.000. Superior Exercise disposed of plant assets at book value. The cost and accumulated depreciation of the disposed asset was $43 500. No cash was received upon disposalarrow_forward
- Strawbale, Incorporated purchases a $329,800 building, paying $228,000 in cash and signing a $101,800 promissory note. What will be reported on the statement of cash flows as a result of this transaction? Multiple Choice A $228,000 cash outflow from investing activities and a $101,800 noncash transaction A $329,800 cash outflow from investing activities A $228,000 cash outflow from investing activities and a $101,800 cash inflow from financing activities A $329,800 cash outflow from investing activities and a $101,800 cash inflow from financing activitiesarrow_forwardUsing a spreadsheet to prepare the statement of cash flows—indirect method The 2018 comparative balance sheet and income statement of Appleton Group, Inc. follow. Appleton disposed of a plant asset at book value during 2018. Prepare the spreadsheet for the 2018 statement of cash flows. Format cash flows from operating activities by the indirect method. A plant asset was disposed of for $0. The cost and accumulated depredation of the disposed asset was $11,600. There were no sales of land, no retirement of common stock, and no treasury stock transactions. Assume plant asset and land acquisitions were for cash.arrow_forwardPreparing the statement of cash flows—indirect method with non-cash transactions The 2018 income statement and comparative balance sheet of Sweet Valley Inc follow: Additionally, Sweet Valley purchased land of $20,900 by financing it 100% with long-term notes payable during 2018. During the year, there were no sales of land, no retirements of stock, and no treasury stock transactions. A plant asset was disposed of for $0. The cost and the accumulated depreciation of the disposed asset was $13,240. Plant asset was acquired for cash. Requirements Prepare the 2018 statement of cash flows, formatting operating activities by the indirect method. How will what you learned in this problem help you evaluate an investment?arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Cornerstones of Financial AccountingAccountingISBN:9781337690881Author:Jay Rich, Jeff JonesPublisher:Cengage LearningFinancial And Managerial AccountingAccountingISBN:9781337902663Author:WARREN, Carl S.Publisher:Cengage Learning,Principles of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax College
- Financial Accounting: The Impact on Decision Make...AccountingISBN:9781305654174Author:Gary A. Porter, Curtis L. NortonPublisher:Cengage Learning
Cornerstones of Financial Accounting
Accounting
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Cengage Learning
Financial And Managerial Accounting
Accounting
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:Cengage Learning,
Principles of Accounting Volume 1
Accounting
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax College
Financial Accounting: The Impact on Decision Make...
Accounting
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Cengage Learning
The ACCOUNTING EQUATION For BEGINNERS; Author: Accounting Stuff;https://www.youtube.com/watch?v=56xscQ4viWE;License: Standard Youtube License