Reference no: EM131178133
Presented below is a schedule of property dispositions for Frank Thomas Co.
| Schedule of Property Dispositions |
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Cost
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Accumulated Depreciation
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Cash Proceeds
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Fair Market Value
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Nature of Disposition
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Land
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$40,000
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$31,000
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$31 ,000
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Condemnation
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Building
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15,000
|
__
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3,600
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_
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Demolition
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Warehouse
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70,000
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$11,000
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74,000
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74,000
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Destruction by fire
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|
Machine
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8,000
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3,200
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900
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7,200
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Trade-in
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|
Furniture
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10,000
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7,850
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-
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3,100
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Contribution
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|
Automobile
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8,000
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3,460
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2,960
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2,960
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Sale
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February 15, a condemnation award was received as consideration for unimproved land held prima-as an investment, and on March 31, another parcel of unimproved land to be held as an investment is purchased at a cost of $35,000.
Building
- April 2, land and building were purchased at a total cost of $75,000, of which 20% was allocated to "--• building on the corporate books. The real estate was acquired with the intention of demolishing the . ;lding, and this was accomplished during the month of November. Cash proceeds received in November resent the net proceeds from demolition of the building.
Warehouse
3n June 30, the warehouse was destroyed by fire. The warehouse was purchased January 2, 2004, and :-.j depreciated $11,000. On December 27, the insurance proceeds and other funds were used to purchase placement warehouse at a cost of $90,000.
Machine
December 26, the machine was exchanged for another machine having a fair market value of $6,300 :-nd cash of $900 was received. (The exchange lacks commercial substance.)
Furniture
August 15, furniture was contributed to a qualified charitable organization. No other contributions - ere made or pledged during the year.
Automobile
November 3, the automobile was sold to Ozzie Guillen, a stockholder.
Instructions
Indicate how these items would be reported on the income statement of Frank Thomas Co. (AICPA adapted)
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