Question

The plant assets section of the comparative balance sheets of Anders Company is reported below.

ANDERS COMPANY
Comparative Balance Sheets
			2017				2016
Plant assets
Equipment		$	285,000			$	375,000
Accum. Depr.—Equipment			(142,000	)			(252,000	)
Equipment, net		$	143,000			$	123,000
Buildings		$	485,000			$	505,000
Accum. Depr.—Buildings			(163,000	)			(348,000	)
Buildings, net		$	322,000			$	157,000

During 2017, equipment with a book value of $61,000 and an original cost of $210,000 was sold at a loss of $7,200.

1. How much depreciation expense was recorded on equipment during 2017?

2. What was the cost of new equipment purchased by Anders during 2017?

Answer 1

	Accumulated depreciation on Equipment sold
	orginal cost				210,000
	less:book value				-61000
	Accumulated depreciation				149,000
1)	Depreciation expense recorded for year 2017
	Accumulated depreciation ,ending					142,000
	beginning accumulated dep				252,000
	less on equipment sold				149,000	103,000
	Depreciation expense for year 2017					39,000	answer
2)	cost of equipment purchased during 2017
	Equipment ,ending					285,000
	beginning equipment				375,000
	less sold during the year				210,000	165,000
	cost of Equipment purchased					120,000	answer