Compute the following items for the statement of cash flows: Beginning and endin

Question

Compute the following items for the statement of cash flows: Beginning and ending Plant Assets, Net, are $130,000 and $127,000, respectively. Depreciation for the period was $25,000, and purchases of new plant assets were $28,000. Plant assets were sold at a $3,000 loss. What were the cash proceeds of the sale? Beginning and ending Retained Earnings are $48,000 and $71,000, respectively. Net income for the period was $63,000, and stock dividends were $12,000. How much were cash dividends? Beginning and ending Assets, Net, are $130,000 and $127,000, respectively. Depreciation for the period was $25,000, and purchases of new plant assets were $28,000.Plant assets were sold at a $3,000 loss. What were the cash proceeds of the sale? Compute the cash proceeds of the sale for the statement of cash flows. Cash proceeds from the sale is $

Explanation / Answer

Requirement a:

   Plant Assets Account ( At Written down value)

To Balance b/d $130000 By Depreciation $25000

   (opening balance)

  

   To cash $28000 By Profit and loss $3000

( purhcase of assets) (loss on sale of plant)

  

By cash(Balancing figure) $3000

   (sale of Plant assets)

By Balance c/d $127000

- (Closing Balance) -   

$158000      $158000

Therefore, the cash proceed from the sale of Plant Asset = $3000

Requirement b:

Ending retained earning = opening retained earning + net income - dividends

$71000 = $48000 + $63000 - ( 12000 + cash dividends)

   $71000 = $48000 + $63000 - 12000 - cash dividend

   cash dividend = 48000 + 63000 -12000 - 71000

cash dividend = $28000

     

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