The three accounts shown below appear in the general ledger of Tovar Corp. during 2010.
|
Equipment |
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|
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 |
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|
Date |
Debit |
Credit |
Balance |
|
|
Jan. 1 |
Balance |
71,000 |
||
|
Nov. 10 |
Accumulated depreciation |
30,000 |
41,000 |
|
|
Dec. 31 |
Depreciation for year |
28,000 |
69,000 |
|
|
Retained Earnings |
||||
|
Date |
Debit |
Credit |
Balance |
|
|
Jan. 1 |
Balance |
105,000 |
||
|
Aug. 23 |
Dividends (cash) |
19,000 |
86,000 |
|
|
Dec. 31 |
Net income |
72,000 |
158,000 |
|
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 sale of equipment was $8,000.