On January 1, 2016, Prairie Enterprises purchased a parcel of land for $28,000 cash. At the time
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Required
a. Assume that the land was sold for $29,500 in 2018.
(1) Show the effect of the sale on the accounting equation.
(2) What amount would Prairie report on the 2018 income statement related to the sale of the land?
(3) What amount would Prairie report on the 2018 statement of cash flows related to the sale of the land?
b. Assume that the land was sold for $24,000 in 2018.
(1) Show the effect of the sale on the accounting equation.
(2) What amount would Prairie report on the 2018 income statement related to the sale of the land?
(3) What amount would Prairie report on the 2018 statement of cash flows related to the sale of the land?
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Related Book For
Fundamental Financial Accounting Concepts
ISBN: 978-0078025907
9th edition
Authors: Thomas Edmonds, Christopher Edmonds
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