The transactions below took place during the year 2019.
1. Convertible bonds payable with a par value of $300,000 were exchanged for unissued ordinary shares with a par value of $300,000. The market price of both types of securities was par.
2. The net income for the year was $360,000.
3. Depreciation expense for the building was $90,000.
4. Some old equipment was traded in on the purchase of some newer equipment and the following entry was made. (The exchange has commercial substance.)

The Gain on Disposal of Plant Assets was credited to current operations as ordinary income.
5. Dividends in the amount of $123,000 were declared. They are payable in January of next year.
Instructions
Show by journal entries the adjustments that would be made on a worksheet for a statement of cash flows.

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Equipment 45,000 Accum. Depreciation-Equipment 30,000 Equipment 40,000 Cash 34,000 Gain on Disposal of Plant Assets 1,000