Reference no: EM131178133

Presented below is a schedule of property dispositions for Frank Thomas Co.

Schedule of Property Dispositions
	Cost	Accumulated Depreciation	Cash Proceeds	Fair Market Value	Nature of Disposition
Land	$40,000		$31,000	$31 ,000	Condemnation
Building	15,000	__	3,600	_	Demolition
Warehouse	70,000	$11,000	74,000	74,000	Destruction by fire
Machine	8,000	3,200	900	7,200	Trade-in
Furniture	10,000	7,850	-	3,100	Contribution
Automobile	8,000	3,460	2,960	2,960	Sale

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)