AP 14–5

a.

Net income for the year amounted to $48, including income taxes expense of $12.

b.

Amortization of patents amounted to $2.

c.

Purchased machinery for $30, paying $10 in cash, and obtained a 5–year loan for the balance.

d.

Purchased $50 of machinery by issuing common shares.

e.

Paid $60 cash for an addition to the building.

f.

Sold land for $24 (gain or loss is included in the income statement).

g.

Declared cash dividends of $22.

h.

Depreciation expense for the year amounted to $16.

i.

Sold machinery for $14 that had originally cost $36; it was one-half depreciated at the time of sale (gain or loss is included in the income statement).

j.

The short-term investments will be sold in 60 days for a known amount of cash.