Marks Consulting Purchased Equipment Costing $45,000 on January 1, Year

question 168

Multiple Choice

Marks Consulting purchased equipment costing $45,000 on January 1, Year 1. The equipment is estimated to have a salvage value of $5,000 and an estimated useful life of 8 years. Straight-line depreciation is used. If the equipment is sold on July 1, Year 5 for $20,000, the journal entry to record the sale will include a:

• A) Debit to accumulated depreciation for $22,500.
• B) Credit to loss on sale for $10,000.
• C) Credit to cash for $20,000.
• D) Debit to loss on sale for $10,000.
• E) Debit to gain on sale for $2,500.

Differentiate between transactions that create and do not create deferrals.

Comprehend how the income statement and retained earning balances are connected.

Understand the purpose and preparation of unadjusted and adjusted trial balances.

Learn the financial reporting and disclosure requirements for dividends and earnings per share.

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Definitions:

Lamellae

Concentric, ring-like layers found in bone, making up the structure of compact bone, or in the chloroplasts of plants, where they contain light-absorbing pigments for photosynthesis.

Compact Bone Tissue

A type of bone tissue that is dense and solid, providing structural strength.

Spongy Bone

Also known as cancellous bone, this is a porous type of bone found at the ends of long bones and in the inner layers of other bones, providing structural support and flexibility.

Trabeculae

Mesh-like structures of supportive or connective tissue found in organs such as the heart, lymph nodes, and spongy bones, aiding in structural support.