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24.03.2020 •
Business
On January 1, Year 1, Prairie Enterprises purchased a parcel of land for $28,000 cash. At the time of purchase, the company planned to use the land for a warehouse site. In Year 3, Prairie Enterprises changed its plans and sold the land. Required a. Assume that the land was sold for $29,500 in Year 3. 1. Show the effect of the sale on the accounting equation. 2. What amount would Prairie report on the Year 3 income statement related to the sale of the land? 3. What amount would Prairie report on the Year 3 statement of cash flows related to the sale of the land? b. Assume that the land was sold for $24,000 in Year 3. 1. Show the effect of the sale on the accounting equation. 2. What amount would Prairie report on the Year 3 income statement related to the sale of the land? 3. What amount would Prairie report on the Year 3 statement of cash flows related to the sale of the land?
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Ответ:
Solution and Explanation:
a1) Accounting equation :
PRAIRIE ENTERPRISES
Accounting equation, year 3
Assets =Stockholder's equity
CashLand=Common Stock+Retained earnings
29500-28000=0 +1500
a2)
a2Gain of Sale of land = $1500
a3Cash flow from investing activities = $29500
b1) Accounting equation :
PRAIRIE ENTERPRISES
Accounting equation, year 3
Assets=Stockholder's equity
CashLand=Common Stock+Retained earnings
24000-28000=0+-4000
b2)
b2 Loss of Sale of land = -$4000
b3 Cash flow from investing activities = $24000
Ответ:
98
explanation: