On January 1, Year 1, Prairie Enterprises purchased a parcel of land for $10,600 cash. At the time of purchase, the company planned to use the land for a warehouse site. In Year 3, Prairie Enterprises changed its plans and sold the land. Required a. Assume that the land was sold for $11,766 in Year 3. (1) Show the effect of the sale on the accounting equation. (2) What amount would Prairie report on the Year 3 income statement related to the sale of the land? (3) What amount would Prairie report on the Year 3 statement of cash flows related to the sale of the land? b. Assume that the land was sold for $9,964 in Year 3. (1) Show the effect of the sale on the accounting equation. (2) What amount would Prairie report on the Year 3 income statement related to the sale of the land? (3) What amount would Prairie report on the Year 3 statement of cash flows related to the sale of the land?

On January 1, Year 1, Prairie Enterprises purchased a parcel of land for $10,600 cash. At the time of purchase, the company planned to use the land for a warehouse site. In Year 3, Prairie Enterprises changed its plans and sold the land. Required a. Assume that the land was sold for $11,766 in Year 3. (1) Show the effect of the sale on the accounting equation. (2) What amount would Prairie report on the Year 3 income statement related to the sale of the land? (3) What amount would Prairie report on the Year 3 statement of cash flows related to the sale of the land? b. Assume that the land was sold for $9,964 in Year 3. (1) Show the effect of the sale on the accounting equation. (2) What amount would Prairie report on the Year 3 income statement related to the sale of the land? (3) What amount would Prairie report on the Year 3 statement of cash flows related to the sale of the land?

Name: On January 1, Year 1, Prairie Enterprises purchased a parcel of land
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Description: On January 1, Year 1, Prairie Enterprises purchased a parcel of land for $10,600 cash. At the time of purchase, the company planned touse the land for a warehouse site. In Year 3, Prairie Enterprises changed its plans and sold the land.Requireda. As

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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