Question: Additional Information A $40,000 note payable is retired at its $40,000 carrying (book) value in exchange for cash. The only changes affecting retained earnings are

Additional Information

  1. A $40,000 note payable is retired at its $40,000 carrying (book) value in exchange for cash.
  2. The only changes affecting retained earnings are net income and cash dividends paid.
  3. New equipment is acquired for $97,000 cash.
  4. Received cash for the sale of equipment that had cost $81,000, yielding a $9,800 gain.

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