Equipment Was Acquired at the Beginning of the Year at a Cost

question 241

Essay

Equipment was acquired at the beginning of the year at a cost of $75,000. The equipment was depreciated using the straight-line method based upon an estimated useful life of 6 years and an estimated residual value of $7,500. (a) What was the depreciation expense for the first year?
(b) Assuming the equipment was sold at the end of the second year for $\$ 59,000$ , determine the gain or loss on sale of the equipment.
(c) Journalize the entry to record the sale.

Understand the impact of changes in consumer preferences on the demand curve.

Recognize the role of substitutes and complements in market dynamics.

Assess the effects of technological advancements and cost changes on market supply.

Evaluate the impact of changes in input prices on the supply curve.

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Definitions:

Articles of Incorporation

A legal document filed with a government body to legally document the creation of a corporation, outlining its purpose, structure, and other essential details.

Certificate of Incorporation

A legal document issued by a government or regulatory body that acknowledges the formation of a corporation and shows it is legally allowed to conduct business.

Raising Capital

The process of gathering funds to finance new investments or pay off debts.

Double Taxation

This term refers to the imposition of taxes on the same income, asset, or financial transaction at two different levels of government or in two different jurisdictions.