Question

Jamison Company reports depreciation expense of $50,000 for Year 2. Also, equipment costing $170,000 was sold for a $6,000 gain in Year 2. The following selected information is available for Jamison Company from its comparative balance sheet. Compute the cash received from the sale of the equipment.

At December 31 Year 2 Year 1
Equipment $ 660,000 $ 830,000
Accumulated Depreciation-Equipment 468,000 550,000

Answer 1

$44,000

Step-by-step explanation:

According to the scenario, computation of the given data are as follow:-

Depreciation on Sold Equipment

Particular Amount($)

Year 1-Accumulated depreciation 550,000

Year 2-Depreciation 50,000

Year 2 –Total accumulated depreciation 600,000

Less-Year 2-Reported depreciation 468,000

Depreciation on sold equipment 132,000

Received Cash from the Sale of Equipment

Particular Amount($)

Cost of equipment 170,000

Less-Depreciation on sold equipment 132,000

Written down value of equipment 38,000

Add-Profit on sale of equipment 6,000

Sale price of equipment 44,000