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The three accounts shown below appear in the gener...

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The three accounts shown below appear in the general ledger of Cesar Corp. during 2010. Equipment Date Debit Credit Balance Jan. 1 Balance 160,000 July 31 Purchase of equipment 70,000 230,000 Sept. 2 Cost of equipment constructed 53,000 283,000 Nov. 10 Cost of equipment sold 49,000 234,000 Accumulated Depreciation-Equipment Date Debit Credit Balance Jan. 1 Balance 71,000 Nov. 10 Accumulated depreciation on equipment sold 30,000 41,000 Dec. 31 Depreciation for year 28,000 69,000 Retained Earnings Date Debit Credit Balance Jan. 1 Balance 105,000 Aug. 23 Dividends (cash) 14,000 91,000 Dec. 31 Net income 67,000 158,000 Instructions From the postings in the accounts, indicate how the information is reported on a statement of cash flows using the indirect method. The loss on sale of equipment was $5,000. (Hint: Cost of equipment constructed is reported in the investing activities section as a decrease in cash of $53,000.)

 

Paper#8402 | Written in 18-Jul-2015

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