The transactions below took place during the year 2010

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The transactions below took place during the year 2010.

1. Convertible bonds payable with a par value of $300,000 were exchanged for unissued common stock with a par value of $300,000. The market price of both types of securities was par.

2. The net income for the year was $360,000.

3. Depreciation expense for the building was $90,000.

4. Some old office equipment was traded in on the purchase of some newer office equipment and the following entry was made. (The exchange has commercial substance.) The Gain on Disposal of Plant Assets was credited to current operations as ordinary income.

5. Dividends in the amount of $123,000 were declared. They are payable in January of next year. Show by journal entries the adjustments that would be made on a worksheet for a statement of cash flows. 

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Reference no: EM131110789

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