Schwerin Corporation Reports the Following on Its 2005 Financial Statements

question 77

Multiple Choice

Schwerin Corporation reports the following on its 2005 financial statements. $\begin{array}{lr}&2004&2005\\\text { From statement of cash flows: }\\\text { Cash proceeds from sale of equipment } && \$ 100 \text { million } \\\text { Cash outflow for purchase of equipment } && 170 \text { million } \\\text { Depreciation } && 50 \text { million } \\\text { Gain from sale of equipment } && 40 \text { million }\end{array}$
-If the beginning and ending property, plant, and equipment are $500 million and $550 million respectively, the gross book value of equipment sold was:

• A)$120 million
• B)$100 million
• C)$80 million
• D)$60 million

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Definitions:

Insurance Advance

A payment made in advance by an insurance company, typically for claims or benefits before the final settlement.

Secretary's Salary

The compensation paid to an administrative professional for performing secretarial and administrative duties.

Chart Of Accounts

An organized list of all accounts in a business entity's financial statements, used to classify and record financial transactions.

Debit And Credit

Accounting terms representing increases or decreases in accounts, used to record transactions in the double-entry bookkeeping system.