The plant assets section of the comparative balance sheets of Anders Company is

Question

The plant assets section of the comparative balance sheets of Anders Company is reported below ANDERS COMPANY Comparative Balance Sheets 2018 2017 Plant assets Equipment Accumulated depreciation-Equipment Equipment, net Buildings Accumulated depreciation-Buildings Buildings, net 200,000 290,000 (108,000) (218,000) $ 92,000 72,000 (112,000) (297,000) 288,000 123,000 During 2018, equipment with a book value of $44,000 and an original cost of $230,000 was sold at a loss of $3,800. 1. How much cash did Anders receive from the sale of equipment? 2. How much depreciation expense was recorded on equipment during 20187 3. What was the cost of new equipment purchased by Anders during 2018? . Cash received from the sale of equipment 2. Depreciation expense 3. Purchase of equipment

Explanation / Answer

1) Cash received from sale of equipment = 44000-3800 = 40200

2) Depreciation expense = (230000-44000)-110000 = 76000

3) Purchase of equipment = 290000-230000-200000 = $140000

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