Equipment with a Cost of $20,000 and a Book Value

question 159

Multiple Choice

Equipment with a cost of $20,000 and a book value of $6,000 was sold during the year for cash of $18,000.Additional equipment was purchased during the year for cash.
What was the amount of cash paid for purchases of equipment during the year?

• A)$80,000
• B)$86,000
• C)$100,000
• D)$62,000

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Definitions:

Clawback

A provision under which money already paid must be returned, often used in employment contracts for the return of bonuses or in investment agreements.

Whistleblower

An individual who exposes any kind of information or activity that is deemed illegal, unethical, or not correct within an organization.

Net Loss

Refers to the situation where a company's expenses exceed its revenues within a specific accounting period, leading to a negative income.

Income Statement

A document summarizing the financial outcomes of a business over a given accounting period, including details on income, costs, and overall profit.