Khonner Stores, Inc., sells electronics and appliances. The excerpts that follow are adapted from Khonner Stores financial

Khonner Stores, Inc., sells electronics and appliances. The excerpts that follow are adapted from Khonner Stores’ financial statements for 2014 and 2013.

Requirements
1. How much was Khonner Stores’ cost of plant assets at February 28, 2014? How much was the book value of plant assets? Show computations.
2. The financial statements give three evidences that Khonner Stores purchased plant assets and goodwill during fiscal year 2014. What are they?
3. Prepare T-accounts for Property, Plant, and Equipment; Accumulated Depreciation; and Goodwill. Then fill in the T-accounts with information from the comparative balance sheets and cash flow statements. Label each increase or decrease and give its dollar amount.
4. Prepare the journal entry for the sale of property and equipment in2014.

Transcribed Image Text:

February 28, 2014 2013 Balancc Sheet (dollars in millions) Assets Property, plant, and equipment...5,63 4,997 Less: Accumulated depreciation2,124 1,729 655 612 Year Ended February 28, 2014 2013 Statement of Cash Flows (dollars in millions) Operating activitics: 1,167 S1,586 Net income. Noncash items affecting net income: Deprcciation.. 560 558 Investing activities: Addions to property, plant, and equipment... Sale of property, plant and equipmen125 pment(913) (819)