Mercury Company Reports Depreciation Expense of $40,000 for Year 2

question 120

Multiple Choice

Mercury Company reports depreciation expense of $40,000 for Year 2. Also, equipment costing $150,000 was sold for its book value in Year 2. There were no other equipment purchases or sales during the year. The following selected information is available for Mercury Company from its comparative balance sheet. Compute the cash received from the sale of the equipment.
$\begin{array}{|l|l|l|}\hline \text { At December 31 } &{\text { Y ear 2 }} & \text { Y ear 1 } \\\hline \text { Equipment } & \$ 600,000 & \$ 750,000 \\\hline \text { Accumulated Depreciation-Equipment } & 428,000 & 500,000\\\hline\end{array}$

• A)$68,000.
• B)$32,000.
• C)$38,000.
• D)$36,000.
• E)$40,000.

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Definitions:

Unconditional Positive Regard

An attitude of total acceptance and support toward another person regardless of what they say or do, often used in the context of client-centered therapy.

Self-efficacy

An individual's belief in his or her capacity to execute behaviors necessary to produce specific performance attainments.

Freudian Theory

A set of psychoanalytic theories developed by Sigmund Freud, emphasizing unconscious processes and the importance of early childhood experiences.

Operant Conditioning

A learning process whereby behavior is controlled by its consequences, including rewards and punishments.