Question

On its December 31, 2017, balance sheet, Calgary Industries reports equipment of $390,000 and accumulated depreciation of $78,000. During 2018, the company plans to purchase additional equipment costing $84,000 and expects depreciation expense of $32,000. Additionally, it plans to dispose of equipment that originally cost $44,000 and had accumulated depreciation of $6,000. The balances for equipment and accumulated depreciation, respectively, on the December 31, 2018 budgeted balance sheet are:

Answer 1

For equipment = $430,000

For accumulated depreciation = $104,000

Explanation:

The solution of balances for equipment and accumulated depreciation is shown below:-

balances for equipment and accumulated depreciation

Particulars Equipment Accumulated depreciation

Beginning balance $390,000 $78,000

Add:

Addition $84,000 $32,000

Less:

Disposition ($44,000) ($6,000)

Balance $430,000 $104,000