Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN: 9781337788281
Author: James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher: Cengage Learning
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Chapter 21, Problem 17E
Investing Activities and
During 2019, Verlando recorded the following transactions affecting these accounts:
- a. Land with a carrying value of $35,000 was sold at a loss of $6,000.
- b. Land and equipment were purchased with cash during the period.
- c. Equipment with an original cost of $20,000 that had a book value of $4,000 was written off as obsolete.
- d. A building with an original cost of $60,000 and
accumulated depreciation of $25,000 was sold at a $23,000 gain. - e. Depreciation expense and amortization expense were recorded.
- f. Net income for the year was $60,000.
- g. A patent was acquired during the year in exchange for 1,200 shares of common stock with a par value of $1 per share and a market value of $26 per share.
- h. Additional marketable securities wefe purchased during the year.
- i. Verlando Company has no notes payable in the liabilities section of its balance sheet.
Required:
- 1. Next Level Assuming that Verlando uses the indirect method to determine operating
cash flows , what is the amount of depreciation expense and amortization expense that would be added back to net income: - 2. Prepare the investing activities section of the statement of cash flows for the year ended December 31, 2019.
- 3. Prepare the disclosure for significant noncash transactions for the statement of cash flows for the year ended December 31, 2019.
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Displayed here are the draft financial statements which have been prepared for Valerie’s business for the year ended 30 April 2021.
Draft Statement of Financial Position as at 30 April 2021
Assets
Non-current assets
see point a. below
Cost
90,000
Provision for depreciation
30,600
Net Book Value
59,400
Current assets
Inventory
To be advised
Trade receivables
43,200
Cash
4,680
47,880
Total assets
107,280
Liabilities
Current liabilities
Trade payables
17,280
Non-current liabilities
Bank loan
16,000
Total liabilities
33,280
Net assets
74,000
Owner’s interest
Capital invested
24,000
Profit and Loss Reserve:
Opening balance
34,720
Draft profit for the year…
The balance sheets of HIROE Inc. showed the following at December 31, 2020 and 2019:
December 31, 2020
December 31, 2019
Equipment, less accumulated depreciation of $212,625 at
December 31, 2020, and $151,875 at December 31, 2019.
$273,375
$334,125
Required:
a. If there have not been any purchases, sales, or other transactions affecting this equipment account since the equipment was first
acquired, what is the amount of the depreciation expense for 2020?
b. Assume the same facts as in part a, and assume that the estimated useful life of the equipment to HİROE Inc., is eight years and that
there is no estimated salvage value. Determine:
1. What the original cost of the equipment was.
2. What depreciation method is apparently being used.
3. When the equipment was acquired.
c. Assume that this equipment account represents the cost of 5 identical machines. Prepare the horizontal model and record the
journal entry for the sale of the machine to calculate the gain or loss on the sale of one…
Pina Colada Corp's statement of financial position at the end of 2019 included the following items:
$1,255,000
$1,095,800
31,800
1,211,000
1,200,000
199,000
321,000
188,000
(144,000 )
(11,600 )
41,600
$2,693,800
Current assets
Land
Buildings
Equipment
Accumulated depreciation-buildings
Accumulated depreciation-equipment
Intangible assets-patents
Total
The following information is available for the 2020 fiscal year:
1.
2.
3.
4.
5.
6.
7.
8.
9.
Current liabilities
Bonds payable
Common shares
Retained earnings
(a)
Total
$2,693,800
Net income was $399,000. Interest paid is classified as operating activities.
Equipment (cost of $20,300 and accumulated depreciation of $8,200) was sold for $10,400.
Depreciation expense was $4,010 on the building and $9,130 on equipment.
Amortization expense on a patent was $3,040.
Current assets other than cash increased by $30,000. Current liabilities increased by $20,000.
An addition to a building was completed at a cost of $32,600.
Pina Colada prepares…
Chapter 21 Solutions
Intermediate Accounting: Reporting And Analysis
Ch. 21 - What information does the statement of cash flows...Ch. 21 - Briefly describe the three types of activities a...Ch. 21 - Thompson Company sold a piece of equipment that...Ch. 21 - Give two examples of a companys (a) cash inflows...Ch. 21 - Prob. 5GICh. 21 - Prob. 6GICh. 21 - Prob. 7GICh. 21 - Prob. 8GICh. 21 - Prob. 9GICh. 21 - List the three operating cash inflows that a...
Ch. 21 - Prob. 11GICh. 21 - Prob. 12GICh. 21 - Prob. 13GICh. 21 - Dunn Company recognized a 5,000 unrealized holding...Ch. 21 - Jordan Company recognized a 5,000 unrealized...Ch. 21 - Indicate how a company computes the amount of...Ch. 21 - Prob. 17GICh. 21 - Prob. 18GICh. 21 - Prob. 19GICh. 21 - Which of the following would be considered a cash...Ch. 21 - In a statement of cash flows (indirect method),...Ch. 21 - The net cash provided by operating activities in...Ch. 21 - The retirement of long-term debt by the issuance...Ch. 21 - Prob. 5MCCh. 21 - Selected information from Brook Corporations...Ch. 21 - Prob. 7MCCh. 21 - Prob. 8MCCh. 21 - Which of the following need not be disclosed in a...Ch. 21 - The following information was taken from Oregon...Ch. 21 - Prob. 1RECh. 21 - Prob. 2RECh. 21 - Given the following information, convert Cardinal...Ch. 21 - Given the following information, convert Robin...Ch. 21 - In the current year, Harrisburg Corporation had...Ch. 21 - Tifton Co. had the following cash transactions...Ch. 21 - Tifton Co. had the following cash transactions...Ch. 21 - Trenton Corporation has the following items....Ch. 21 - Prob. 9RECh. 21 - In the current year, Harrisburg Corporation...Ch. 21 - Providence Company sold equipment for 25,000 cash....Ch. 21 - Annapolis Corporation paid 270,000 to retire bonds...Ch. 21 - Given the following information, compute Lemon...Ch. 21 - Prob. 14RECh. 21 - Prob. 1ECh. 21 - Prob. 2ECh. 21 - Visual Inspection Noble Companys accounting...Ch. 21 - Prob. 4ECh. 21 - Prob. 5ECh. 21 - Prob. 6ECh. 21 - Prob. 7ECh. 21 - Prob. 8ECh. 21 - Partially Completed Spreadsheet Hanks Company has...Ch. 21 - Spreadsheet The following 2019 information is...Ch. 21 - Spreadsheet and Statement The following 2019...Ch. 21 - Fixed Asset Transactions The following is an...Ch. 21 - Retirement of Debt Moore Company is preparing its...Ch. 21 - Interest and Income Taxes Staggs Company has...Ch. 21 - Investments On October 4, 2019, Collins Company...Ch. 21 - Statement of Cash Flows The following is a list of...Ch. 21 - Investing Activities and Depreciable Assets...Ch. 21 - Spreadsheet and Statement The following 2019...Ch. 21 - (Appendix 21.1) Operating Cash Flows The following...Ch. 21 - (Appendix 21.1) Statement of Cash Flows The...Ch. 21 - (Appendix 21.1) Visual Inspection The following...Ch. 21 - Prob. 22ECh. 21 - Classification of Cash Flows A company's statement...Ch. 21 - Prob. 2PCh. 21 - Statement of Cash Flows The following is a list of...Ch. 21 - Statement of Cash Flows The following is a list of...Ch. 21 - Partially Completed Spreadsheet The following...Ch. 21 - Spreadsheet and Statement of Cash Flows The...Ch. 21 - Prob. 7PCh. 21 - Spreadsheet from Trial Balance Heinz Companys post...Ch. 21 - Prepare Ending Balance Sheet On December 31, 2019,...Ch. 21 - Infrequent Transactions The following transactions...Ch. 21 - Prob. 11PCh. 21 - Comprehensive Angel Company has prepared its...Ch. 21 - Comprehensive The following are Farrell...Ch. 21 - (Appendix 21.1) Operating Cash Flows Refer to the...Ch. 21 - (Appendix 21.1) Statement of Cash Flows The...Ch. 21 - Comprehensive The following are Farrell...Ch. 21 - (Appendix 21.1) Comprehensive The following are...Ch. 21 - Prob. 18PCh. 21 - Financial Statement Interrelationships Prepare an...Ch. 21 - Statement of Cash Flows A friend of yours is...Ch. 21 - Prob. 3CCh. 21 - Operating, Investing, and Financing Activities The...Ch. 21 - Prob. 5CCh. 21 - Spreadsheet Method The spreadsheet method is...Ch. 21 - Prob. 7CCh. 21 - Inflows and Outflows Alfred Engineering Company is...Ch. 21 - Ethics and Cash Flows You are the accountant for...
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