Question

Brief Exercise 17-07 x Your answer is incorrect. Try again. The T-accounts for Equipment and the related Accumulated Depreciation-Equipment for Luo Company at the end of 2020 are shown here. 22,700 Equipment Beg. bal. 82,400 Disposals Acquisitions 36,500 End. bal. 96,200 Accumulated Depreciation Equipment Disposals 8,500 Beg. bal. Depr. exp. End. bal. 46,800 13,000 51,300 In addition, Luo's income statement reported a loss on the disposal of plant assets of $6,100. What amount was reported on the statement of cash flows as "cash flow from sale of equipment"? (Show amount that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).) Cash flow from sale of equipment

3 Questions, Help !

Answer 1

1) Book value of equipment = 22700-8500 = 14200

Cash received from sale of equipment = 14200-6100 = 8100

2) Statement of Cash flow (partial)

For the year ended December 31,2020

Cash flow from operating activities
Net income		2800000
Adjustment to reconcile net income to
Net cash provided by operating activities
Depreciation expense	158900
Decrease account receivable	342500
Decrease account payable	-255200
		246200
Net cash provided by operating activities		3046200

3) Statement of Cash flow (partial)

For the year ended December 31,2020

Cash flow from operating activities
Net income		194800
Adjustment to reconcile net income to
Net cash provided by operating activities
Depreciation expense	43200
Loss on disposal of plant assets	5500
Decrease account receivable	16900
Increase account payable	18900
Decrease prepaid expense	3100
		87600
Net cash provided by operating activities		282400