Solved

Schubert Co

Question 89

Matching

Schubert Co.owned equipment that originally cost $48,000.On January 1,Year 6,the company sold the equipment for $16,000 cash.Accumulated depreciation on the day of sale amounted to $34,000.Based on this information,indicate whether each of the following statements is true or false.

Premises:

Responses:

The sale would increase Schuberts stockholders' equity by $2,000.

False

The sale will increase Schuberts net income,but it will not affect the company's operating income.

True

Schubert would show a $16,000 cash inflow in the operating activities section of the cash flow statement.

The sale would result in a decrease in total assets.

The sale would increase cash by $16,000,increase gain on sale of equipment by $2,000,and decrease equipment by $14,000.

Premises:

The sale would increase Schuberts stockholders' equity by $2,000.

The sale will increase Schuberts net income,but it will not affect the company's operating income.

Schubert would show a $16,000 cash inflow in the operating activities section of the cash flow statement.

The sale would result in a decrease in total assets.

The sale would increase cash by $16,000,increase gain on sale of equipment by $2,000,and decrease equipment by $14,000.

Responses:

False

True

Correct Answer:

Premises:

Responses:

The sale would increase Schuberts stockholders' equity by $2,000.

The sale will increase Schuberts net income,but it will not affect the company's operating income.

Schubert would show a $16,000 cash inflow in the operating activities section of the cash flow statement.

The sale would result in a decrease in total assets.

The sale would increase cash by $16,000,increase gain on sale of equipment by $2,000,and decrease equipment by $14,000.

Related Questions

Q84: Ernie Company acquired Bert Company in January

Q85: Indicate whether each of the following statements

Q85: When a building is purchased simultaneously with

Q86: Indicate whether each of the following statements

Q88: Rupert Company purchased a delivery van on

Q90: The term used to recognize expense for

Q91: Indicate whether each of the following statements

Q93: Indicate whether each of the following statements

Q94: On January 1,Year 1,Warren Co.purchased a machine

Q97: How is depreciation expense reported in the

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

Scan the QR code to install the App and get 2 free unlocks

Unlock quizzes for free by uploading documents