Consider the Following Transactions

question 59

Multiple Choice

Consider the following transactions:
(i) issued share capital for cash of $250 000
(ii) received $50 000 from accounts receivable
(iii) paid $30 000 to accounts payable
(iv) purchased new equipment for $160 000 on credit
Total assets increased by:

• A) $220 000.
• B) $230 000.
• C) $380 000.
• D) $430 000.

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Definitions:

Historical Cost

The original monetary value of an asset or liability, reflecting its purchase price or value at the time of acquisition, not adjusted for inflation or market changes.

Discounted Present Values

The calculation of the present value of an expected future cash flow using a specific discount rate.

Net Property

This term typically refers to the net book value of a company's property, plant, and equipment (PP&E) after accounting for depreciation and amortization.

Accumulated Depreciation

The total amount of depreciation expense that has been recorded for an asset since it was acquired, reflecting its loss of value over time.