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The following accounts and corresponding balances were drawn from balance sheets: Account Title Investment securities Machinery Land Year 2 $ 101,800 520, 300 145,800 Year 1 $ 116,900 425,000 93,800

The following accounts and corresponding balances were drawn from balance sheets: Account Title Investment securities Machinery Land Year 2 $ 101,800 520, 300 145,800 Year 1 $ 116,900 425,000 93,800

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Exercise 12-10A (Algo) Determining cash flows from investing activities LO 12-3 [The following information applies to the questions displayed below.] The following accounts and corresponding balances were drawn from Delsey Company's Year 2 and Year 1 year-end balance sheets: Account Title Investment securities Machinery Land Exercise 12-10A (Algo) Part b Year 2 5 101,800 520, 300 145,800 Other Information drawn from the accounting records: 1. Delsey incurred a $1,340 loss on the sale of investment securities during Year 2. 2. Old machinery with a book value of $5,000 (cost of $25,530 minus accumulated depreciation of $20,530) was sold. The income statement showed a gain on the sale of machinery of $4,880. 3. Delsey did not sell land during the year. Year 1 $ 116,900 425,000 93,800 Cost of machinery purchased b. Compute the amount of cash flow associated with the purchase of machinery.
Transcribed Image Text:Exercise 12-10A (Algo) Determining cash flows from investing activities LO 12-3 [The following information applies to the questions displayed below.] The following accounts and corresponding balances were drawn from Delsey Company's Year 2 and Year 1 year-end balance sheets: Account Title Investment securities Machinery Land Exercise 12-10A (Algo) Part b Year 2 5 101,800 520, 300 145,800 Other Information drawn from the accounting records: 1. Delsey incurred a $1,340 loss on the sale of investment securities during Year 2. 2. Old machinery with a book value of $5,000 (cost of $25,530 minus accumulated depreciation of $20,530) was sold. The income statement showed a gain on the sale of machinery of $4,880. 3. Delsey did not sell land during the year. Year 1 $ 116,900 425,000 93,800 Cost of machinery purchased b. Compute the amount of cash flow associated with the purchase of machinery.
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