Use the Following Selected Data and Additional Information from the Records

question 48

Essay

Use the following selected data and additional information from the records of Utah Corp. to answer the questions that follow.
1 Equipment with a cost of $15,000 and a book value of $3,000 was sold for $5,000 during 2016.
2 Common stock was issued to retire bonds payable during 2016.
3 The only items affecting retained earnings in 2016 were net income and dividends declared and paid.
-Review the data for Utah Corp.
REQUIRED:
A What amount was paid to retire bonds payable during 2016?
B How would the transaction to retire bonds by issuing common stock be reported on the statement of cash flows for 2016 for Utah Corp.?

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Definitions:

Noncorporate Sector

The part of the economy composed of households and unincorporated businesses, contrasted with the corporate sector which consists of incorporated businesses.

Elasticity Of Labor Supply

The responsiveness of the quantity of labor offered to changes in wage rates.

Payroll Tax

Monetary charges on employers or their employees, usually reckoned as a share of the salaries given to staff.

Welders

Professionals skilled in joining metal parts together by melting and fusing them using various welding techniques.