Fully depreciated equipment costing $50,000 is discarded. What is the effect of the transaction on cash flows if (a) $15,000 cash is received for the equipment, (b) no cash is received for the equipment?
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- Fully depreciated Equipment costing $50000 was discarded. what was the effect of the transaction on cash flows if (a)$15000 cash is received, (b) no cash is received?The company provided the data of PP&E in a cash-generating unit (CGU) as follows: Cost Accumulated Depreciation Equipment A $ 15,000 $ 8,000 Equipment B 30,000 19,000 Equipment C 45,000 23,000 The unit’s fair value less costs to sell was $25,000. The unit’s future cash flows was $32,000, and its present value was $28,000. The company adopted IFRS. Prepare journal entries to record impairment. If the recoverable amount of Equipment C is $19,000, prepare journal entries to record impairment. If the recoverable amount of Equipment C is $24,000, prepare journal entries to record impairment.ABC has determined that one of its cash generating units (CGU) is impaired. The assets of the CGU at their book value are: Land – 4,000,000; Factory – 1,200,000; Machinery and Equipment – 1,800,000. The value in use of the cash generating unit is P5,500,000. The impairment loss allocated to Machinery and Equipment is? (do not round off the percentage, round off your final answer to the nearest peso)
- Atkins Corporation has provided the following information for the year ended December 31, 2019:• The equipment account balance increased $200,000.• The equipment accumulated depreciation account increased $35,000.• Equipment costing $50,000 was sold during the year resulting in a $10,000 gain.• Depreciation expense on the equipment recorded during the year was $65,000. Which of the following statements is incorrect with respect to preparation of the statement of cash flows? Assume that the equipment purchase and sale resulted in cash flows. A. A $60,000 cash inflow is reported from the equipment sale. B. Using the indirect method, net income is increased by the $65,000 depreciation expense. C. Using the indirect method, net income is decreased by the $10,000 gain on the sale of the equipment. D. A $30,000 cash inflow is reported from the equipment sale.36. On May 1, 2021, Salad Co. sold used equipment for a cash amount equaling its carrying amount for both book and tax purposes. On May 15, 2021, Salad replaced the equipment by paying cash and signing a note payable for new equipment. The cash paid for the new equipment exceeded the cash received for the old equipment. How should these equipment transactions be reported in Salad's 2021 statement of cash flows? a. Cash outflow equal to the cash paid and note payable less the cash received. b. Cash inflow equal to the cash received and a cash outflow equal to the cash paid. c. Cash inflow equal to the cash received and a cash outflow equal to the cash paid and note payable. d. Cash outflow equal to the cash paid less the cash received.Un Company sold office equipment with a cost of $42,960 and accumulated depreciation of $39,803 for $5,640. a. what is the book value of the asset at the time of sale b, what is the amount of gain/loss on the disposal c. how would the sale affect net income and by how much d. how would the sale affect the amount of total assets shown on the balance sheet e. how would the event affect the statements of cash flows
- 2. ABC Co. has a department that performs machining operations on parts that are sold to contractors. A group of machines had an aggregate carrying amount of P3,690,000 on December 31, 2019. This group of machinery has been determined to constitute a cash generating unit for purposes of applying PAS 36, Impairment of Assets. A cash generating unit is defined in this standard, is the smallest identifiable group of assets that generates cash flows that are largely independent of the cash flows from other assets or groups of assets. Presented below are the data about future expected cash inflows and outflows based on the diminishing productivity expected of the machinery as it ages and the increasing costs that will be incurred to generate output from the machines.Year – Inflows - Outflows (Excludes noncash cash charges)2020 - 2,250,000 - 840,0002021 - 2,400,000 - 1,260,0002022 - 1,950,000 - 1,650,0002023 - 600,000 - 450,000The fair value of the machinery in this cash generating unit, net…On 1/1/X2, Hudson Enterprises decided to sell equipment it had been using in its business for $25,000 cash. The following data are available for the equipment as of the disposal date: Cost $200,000 Original estimated residual value 25,000 Accumulated Depreciation as of 12/31/X1 160,000 Question: How much gain or loss should be recorded on the sale of this asset?Answer: The company should report a _____ (gain or loss) of $ ___Bramble Manufacturing has old equipment that cost $56,000. The equipment has accumulated depreciation of $27,600. Bramble has decided to sell the equipment. (a)What entry would Bramble make to record the sale of the equipment for $30,000 cash? (b)What entry would Bramble make to record the sale of the equipment for $15,000 cash?
- Flanagan Concrete owns equipment with a book value of $3,500,000. The equipment is estimated to generate future cash flows of $2,975,000. The equipment has a fair value of $2,890,000. The journal entry to record the impairment loss will a.) increase the asset’s Accumulated Depreciation account by $610,000. b.) include a $610,000 credit to the Equipment account. c.) record a loss of $85,000. d.) reduce income from continuing operations by $525,000.Georgia Peach has the following information regarding the sale of its equipment: Sales price $8,000 Cost $25,000 Accumulated depreciation $19,000 Which of the following statements is true regarding how the above information would be reported on Georgia's statement of cash flows? Group of answer choices Loss on sale of plant asset will be $17,000 Gain on sale of plant asset will be $2,000 Depreciation expense will be $19,000 Cash received from sale of plant asset will be $25,000Fearless Flying Squirrels Company collected the following data in its accounting records in 2022: From the income statement: Depreciation expense $1,100 Loss on sale of equipment 3,100 From the comparative balance sheet: Beginning balance, equipment $12,500 Ending balance, equipment 7,900 Beginning balance, accumulated depreciation 1,900 Ending balance, accumulated depreciation 2,300 No new equipment was purchased during the year. Required: What was the cash in-flow from the sale of equipment in 2022?