Financial Accounting (12th Edition) (What's New in Accounting)
12th Edition
ISBN: 9780134725987
Author: C. William Thomas, Wendy M. Tietz, Walter T. Harrison Jr.
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Concept explainers
Question
Chapter 7, Problem 7.36AE
To determine
To Show: For each transaction, Corporation A would report for investing activities on its statement of
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
(Learning Objective 8: Report cash flows for plant assets) Assume AlfonsoCorporation completed the following transactions:a. Sold a store building for $670,000. The building had cost Alfonso $1,600,000, and at thetime of the sale, its accumulated depreciation totaled $930,000.b. Lost a store building in a fire. The building cost $300,000 and had accumulateddepreciation of $220,000. The insurance proceeds received by Alfonso totaled $200,000.c. Renovated a store at a cost of $140,000 (cash).d. Purchased store fixtures for $110,000 (cash). The fixtures are expected to remain inservice for ten years and then be sold for $110,000. Alfonso uses the straight-linedepreciation method.For each transaction, show what Alfonso would report for investing activities on its statement ofcash flows. Show negative amounts in parentheses.
E7-22A. (Learning Objective 1: Measure the cost of plant assets) Murphy Self Storagepurchased land, paying $160,000 cash as a down payment and signing a $185,000 note payablefor the balance. Murphy also had to pay delinquent property tax of $2,000, title insurance costing$6,000, and $11,000 to level the land and remove an unwanted building. The company paid$58,000 to add soil for the foundation and then constructed an office building at a cost of $700,000.It also paid $52,000 for a fence around the property, $11,000 for the company sign near theproperty entrance, and $3,000 for lighting of the grounds. What is the capitalized cost of eachof Murphy’s land, land improvements, and building?
Learning Objectives 1, 3, 8: Report plant assets, depreciation, and investing cashflows) On January 1, 2018, Black Iron Bar & Grill purchased a building, paying $56,000cash and signing a $101,000 note payable. The company paid another $60,000 to remodel thebuilding. Furniture and fixtures cost $51,000, and dishes and supplies—a current asset—wereobtained for $9,600. All expenditures were for cash. Assume that all of these expendituresoccurred on January 1, 2018.Black Iron is depreciating the building over 25 years using the straight-line method, with anestimated residual value of $52,000. The furniture and fixtures will be replaced at the end of fiveyears and are being depreciated using the double-declining-balance method, with a residual valueof zero. At the end of the first year, the company still had dishes and supplies worth $1,600.Show what the company reported for supplies, plant assets, and cash flows at the end of thefirst year on its■ income statement,■ balance sheet, and■…
Chapter 7 Solutions
Financial Accounting (12th Edition) (What's New in Accounting)
Ch. 7 - Smatter Corporation purchased land for a new...Ch. 7 - Carlos Company purchased a building and land for...Ch. 7 - Whitmore Corporation purchased a new delivery van...Ch. 7 - When a company expenses the cost of maintenance...Ch. 7 - Prob. 5QCCh. 7 - Planter Company purchased a delivery van for...Ch. 7 - Bixby Corporation purchased a forklift for 40,000...Ch. 7 - On the first day of its fiscal year, Spearhead...Ch. 7 - The depreciation method that does not initially...Ch. 7 - Sokolsky Excavating purchased a used dump truck...
Ch. 7 - Barron Fuel purchased an oil well for 200,000. The...Ch. 7 - Prob. 12QCCh. 7 - Prob. 13QCCh. 7 - Prob. 14QCCh. 7 - Prob. 15QCCh. 7 - Prob. 16QCCh. 7 - Prob. 7.1ECCh. 7 - LO 1 (Learning Objective 1: Measure the cost and...Ch. 7 - LO 1 (Learning Objective 1: Measure and record the...Ch. 7 - Prob. 7.3SCh. 7 - Prob. 7.4SCh. 7 - LO 3 (Learning Objective 3: Compute depreciation...Ch. 7 - Prob. 7.6SCh. 7 - LO 3 (Learning Objective 3: Compute depreciation...Ch. 7 - LO3 (Learning Objective 3: Compute depreciation...Ch. 7 - LO 3 (Learning Objective 3: Compute depreciation...Ch. 7 - LO 3 (Learning Objective 3: Compute depreciation...Ch. 7 - LO 3 (Learning Objective 3: Compute depreciation...Ch. 7 - Prob. 7.12SCh. 7 - Prob. 7.13SCh. 7 - Prob. 7.14SCh. 7 - Prob. 7.15SCh. 7 - Prob. 7.16SCh. 7 - Prob. 7.17SCh. 7 - LO 6 (Learning Objective 6: Explain the effect of...Ch. 7 - Prob. 7.19SCh. 7 - LO 7 (Learning Objective 7: Calculate return on...Ch. 7 - Prob. 7.21SCh. 7 - Prob. 7.22AECh. 7 - Prob. 7.23AECh. 7 - LO 2 (Learning Objective 2: Distinguish capital...Ch. 7 - Prob. 7.25AECh. 7 - LO 3 (Learning Objective 3: Determine depreciation...Ch. 7 - LO 1,3,8 E7-27A, (Learning Objectives 1, 3, 8:...Ch. 7 - LO 3 (Learning Objective 3: Change a plant assets...Ch. 7 - LO 3, 4 (Learning Objectives 3, 4: Compute...Ch. 7 - Prob. 7.30AECh. 7 - LO 1, 3, 4 (Learning Objectives 1, 3, 4: Measure a...Ch. 7 - Prob. 7.32AECh. 7 - Prob. 7.33AECh. 7 - Prob. 7.34AECh. 7 - LO 7 (Learning Objective 7: Calculate return on...Ch. 7 - Prob. 7.36AECh. 7 - Prob. 7.37BECh. 7 - Prob. 7.38BECh. 7 - Prob. 7.39BECh. 7 - Prob. 7.40BECh. 7 - Prob. 7.41BECh. 7 - Prob. 7.42BECh. 7 - LO 3 (Learning Objective 3: Change a plant assets...Ch. 7 - LO 3.4 (Learning Objectives 3.4: Compute...Ch. 7 - Prob. 7.45BECh. 7 - Prob. 7.46BECh. 7 - Prob. 7.47BECh. 7 - Prob. 7.48BECh. 7 - Prob. 7.49BECh. 7 - Prob. 7.50BECh. 7 - Prob. 7.51BECh. 7 - Prob. 7.52QCh. 7 - Prob. 7.53QCh. 7 - Prob. 7.54QCh. 7 - Prob. 7.55QCh. 7 - Prob. 7.56QCh. 7 - Madison Corporation acquired a machine for 27,000...Ch. 7 - Prob. 7.58QCh. 7 - Prob. 7.59QCh. 7 - Prob. 7.60QCh. 7 - Prob. 7.61QCh. 7 - Prob. 7.62QCh. 7 - Prob. 7.63QCh. 7 - Prob. 7.64QCh. 7 - Prob. 7.65QCh. 7 - Prob. 7.66QCh. 7 - Prob. 7.67APCh. 7 - (Learning Objectives 1, 3: Measure and account for...Ch. 7 - (Learning Objectives 1, 3, 4: Measure and account...Ch. 7 - Prob. 7.70APCh. 7 - (Learning Objectives 1, 3, 4, 6, 8: An21yze plant...Ch. 7 - Prob. 7.72APCh. 7 - (Learning Objectives 1, 4, 8: Analyze the effect...Ch. 7 - Prob. 7.74APCh. 7 - (Learning Objectives 4, 8: Analyze the effect of a...Ch. 7 - Prob. 7.76BPCh. 7 - Prob. 7.77BPCh. 7 - Prob. 7.78BPCh. 7 - Prob. 7.79BPCh. 7 - Prob. 7.80BPCh. 7 - Prob. 7.81BPCh. 7 - (Learning Objectives 1, 4, 8: Analyze the effect...Ch. 7 - Prob. 7.83BPCh. 7 - Prob. 7.84BPCh. 7 - LO 3 (Learning Objective 3: Determine the effect...Ch. 7 - Prob. 7.86CEPCh. 7 - Prob. 7.87CEPCh. 7 - Prob. 7.88SCCh. 7 - Prob. 7.89DCCh. 7 - Prob. 7.90DCCh. 7 - Prob. 7.91EICCh. 7 - Prob. 1FFCh. 7 - Focus on Analysis Under Armour, Inc. LO 1, 3, 5,...
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
- (Learning Objectives 1, 3, 8: Report plant assets, depreciation, and investing cashflows) On January 1, 2018, Little City Bar & Grill purchased a building, paying $58,000 cashand signing a $110,000 note payable. The company paid another $62,000 to remodel thebuilding. Furniture and fixtures cost $55,000, and dishes and supplies—a current asset—wereobtained for $9,400. All expenditures were for cash. Assume that all of these expendituresoccurred on January 1, 2018.Little City is depreciating the building over 25 years using the straight-line method, with anestimated residual value of $51,000. The furniture and fixtures will be replaced at the end of fiveyears and are being depreciated using the double-declining-balance method, with a residual valueof zero. At the end of the first year, the company still had dishes and supplies worth $1,300.Show what the company reported for supplies, plant assets, and cash flows at the end of thefirst year on its■ income statement,■ balance sheet,…arrow_forwardPhelm Corporation sold a piece of equipment for cash and recognized a gain of $5,000. The original cost was $34,000 and the accumulated depreciation just prior to the sale totaled $19,000. What amount will appear in the investing activities section of the statement of cash flows? $20,000 $54,000 $10,000 $15,000arrow_forwardAssume a company did not purchase any equipment during the year, but it did sell a piece of equipment that had an original cost of $500,000 and accumulated depreciation of $300,000. The gain on the sale was $25,000. Based solely on the information provided, the company’s net cash provided by (used in) investing activities would be: Multiple Choice $200,000. $225,000. $250,000. $275,000.arrow_forward
- (Learning Objectives 1, 3: Measure, depreciate, and report plant assets) During2018, Chang’s Book Store paid $481,000 for land and built a store in Newark, New Jersey.Prior to construction, the city of Newark charged Chang’s $1,200 for a building permit, whichChang’s paid. Chang’s also paid $15,200 for architect’s fees. The construction cost of $679,900was financed by a long-term note payable, with interest costs of $28,180 paid at the completionof the project. The building was completed June 30, 2018. Chang’s depreciates the buildingusing the straight-line method over 35 years, with estimated residual value of $335,000.1. Journalize transactions for the following (explanations are not required):a. Purchase of the landb. All the costs chargeable to the building in a single entryc. Depreciation on the building for 20182. Report Chang’s plant assets on the company’s balance sheet at December 31, 2018.3. What will Chang’s income statement for the year ended December 31, 2018, report…arrow_forward(Learning Objectives 1, 3: Measure, depreciate, and report plant assets) During2018, Ming’s Book Store paid $486,000 for land and built a store in Naperville, Illinois.Prior to construction, the city of Naperville charged Ming’s $1,000 for a building permit,which Ming’s paid. Ming’s also paid $15,000 for architect’s fees. The construction cost of$670,000 was financed by a long-term note payable, with interest costs of $28,020 paid atthe completion of the project. The building was completed June 30, 2018. Ming’s depreciatesthe building using the straight-line method over 35 years, with estimated residual value of$330,000.1. Journalize transactions for the following (explanations are not required):a. Purchase of the landb. All the costs chargeable to the building in a single entryc. Depreciation on the building for 20182. Report Ming’s plant assets on the company’s balance sheet at December 31, 2018.3. What will Ming’s income statement for the year ended December 31, 2018, report for…arrow_forwardUsing the following information, compute cash paid to purchase property, plant, and equipment. Depreciation expense ................................ .....................................$13,000 End of Year Begnning of Year Property,plant and Equipment.... .............. $ 134,000 $ 124,000 Accumulated depreciation ................................ 32,000 41,000 During the year, property, plant, and equipment with an original cost of $28,000 was sold for a gain of $6,500. Compute the amount of cash received from the sale of the property, plant, and equipment.arrow_forward
- ABC is testing a store branch for impairment. The assets of thebranch include a building with a carrying amount of P4,000,000,equipment of P3,000,000, inventory of P2,000,000 and goodwill ofP500,000. The fair value less cost to dispose of the inventory is P2,500,000.The expected cashflows from the branch are: Year Amount1 P 2,000,0002 1,700,0003 1,500,0004 1,500,0005 1,300,000 The effective interest rate is 9%. The present value of the cashflowsbeyond year 5 is estimated to be at P400,000. 10. Value in use of the store branch11. Total Impairment Loss12. Carrying value of the building after impairment13. Carrying value of the inventory after impairment14. Carrying value of the goodwill after impairmentarrow_forward1) Darling Paper Container, Inc. purchased several machines at a total cost of $300,000. The installation cost for this equipment was $25,000. The firm plans to depreciate the equipment using the MACRS 5-year normal recovery period. Prepare a depreciation schedule showing the depreciation expense for each year. 2) Identify each expense or revenue as a cash flow from operating activities (O), a cash flow from investment activities (I), or a cash flow from financing activities (F). Administrative expenses Rent payment Interest on a note payable Interest on a note receivable Sale of equipment Dividend payment Stock repurchase Sale of finished goods Labor expense Sale of a bond issue Repayment of a long-term debt Selling expenses Depreciation expense Sale of common stock Purchase of fixed assets 3) Please read the “COPING WITH UNCERTAINTY IN THE CASH BUDGET” topic in your book on pages 133-134 before solving this question. Terrel Manufacturing expects stable sales through the…arrow_forwardTBB Corp. has the following information regarding three of its assets: Estimated Book Value Cash Flows Fair Value Equipment $ 35,000 $ 36,000 $ 30,000 Building $ 68,000 $ 70,000 $ 65,000 Patent $ 30,000 $ 28,000 $ 26,000 What amount of loss should be recorded by TBB due to asset impairment? Select one: a. $4,000 b. $7,000 c. $12,000 d. $10,000 e. $6,000arrow_forward
- Could someone please help fill out this problem for my study guide. At December 31, 2022, Windsor, Inc. reported the following plant assets. Land $ 3,870,000 Buildings $27,080,000 Less: Accumulated depreciation—buildings 12,186,000 14,894,000 Equipment 48,520,000 Less: Accumulated depreciation—equipment 6,065,000 42,455,000 Total plant assets $61,219,000 During 2023, the following selected cash transactions occurred. April 1 Purchased land for $2,140,000. May 1 Sold equipment that cost $930,000 when purchased on January 1, 2016. The equipment was sold for $279,000. June 1 Sold land for $1,590,000. The land cost $1,002,000. July 1 Purchased equipment for $1,102,000. Dec. 31 Retired equipment that cost $717,000 when purchased on December 31, 2013. No salvage value was received. Journalize the transactions. (Hint: You may wish to set up T-accounts, post beginning balances, and then post…arrow_forward10. PETRON Corporation sold a fixed asset for P100,000, which was also its book value. This isA. an investment cash flow and a source of funds.B. an operating cash flow and a source of funds.C. an operating cash flow and a use of funds.D. an investment cash flow and a use of funds. 11. SMART Corporation raises P500,000 in long-term debt to acquire additional plant capacity. This is consideredA. an investment cash flow.B. a financing cash flow.C. a financing cash flow and investment cash flow, respectively.D. a financing cash flow and operating cash flow, respectively. 12. All of the following are financing cash flows EXCEPTA. sale of stock.B. payment of stock dividends.C. increasing debt.D. repurchasing stock. 13. All of the following are operating cash flows EXCEPTA. net profit/earnings after tax.B. increase or decrease in current liabilities.C. increase or decrease in fixed assets.D. depreciation expense.arrow_forward33.-Zenith Corporation sells some of its used store fixtures. The acquisition cost of the fixtures is $13,409, and the accumulated depreciation on these fixtures is $7,395 at the time of sale. The fixtures are sold for $3,700. The value of this transaction in the investing section of the statement of cash flows is a.$6,014 b.$2,314 c.$13,409 d.$3,700arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
- Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSONIntermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill EducationFinancial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
Accounting
Accounting
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:Cengage Learning,
Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...
Accounting
ISBN:9780134475585
Author:Srikant M. Datar, Madhav V. Rajan
Publisher:PEARSON
Intermediate Accounting
Accounting
ISBN:9781259722660
Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:9781259726705
Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:McGraw-Hill Education