Financial and Managerial Accounting: E13-6 The three accounts shown below appear in the general

Financial and Managerial AccountingE13-6
The three accounts shown below appear in the general ledger of Herrick Corp. during 2017.
Equipment
Date      Debit Credit Balance
Jan. 1 Balance 160,000 
July 31 Purchase of equipment 70,000 230,000 
Sept. 2 Cost of equipment constructed 53,000 283,000 
Nov. 10 Cost of equipment sold 49,000 234,000 
 
Accumulated Depreciation—Equipment
Date      Debit Credit Balance
Jan. 1 Balance 71,000 
Nov. 10 Accumulated depreciation on equipment sold 28,000 43,000 
Dec. 31 Depreciation for year 23,000 66,000 
 
Retained Earnings
Date      Debit Credit Balance 
Jan. 1 Balance 105,000 
Aug. 23 Dividends (cash) 17,000 88,000 
Dec. 31 Net income 67,000 155,000 
 
Instructions
From the postings in the accounts, indicate how the information is reported on a statement of cash flows using the indirect method. The loss on disposal of equipment was $5,000. (Hint: Cost of equipment constructed is reported in the investing activities section as a decrease in cash of $53,000.)
 
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