Savanaugh Stores, Inc., sells electronics and appliances. The excerpts that follow are adapted from Savanaugh’s financial statements for 2021 and 2020. 

Requirements 

1. How much was Savanaugh’s cost of plant assets at March 31, 2021? How much was the book value of plant assets? Show computations.

2. The financial statements provide three pieces of evidence that Savanaugh purchased plant assets and goodwill during fiscal year 2021. 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, plant, and equipment in 2021.

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Balance Sheet (dollars in millions) Assets Total current assets. Property, plant, and equipment. Less: Accumulated depreciation. Goodwill..............…...... Statement of Cash Flows (dollars in millions) Operating activities: Net income. March 31, 2021 2020 $7,986 $6,906 4,833 4,196 2,129 1,723 552 512 Noncash items affecting net income: Depreciation.......... Gain on sale of property, plant, and equipment.…........ Investing activities: Additions to property, plant, and equipment Sale of property, plant, and equipment......... ........ Year Ended March 31, 2021 2020 $1,149 $989 473 (142) 460 0 (712) (616) 150 0