The Capitals Company has provided you the following information pertaining to the year ending December 31,2015:
$\begin{array}{lll}&\text { January 1,2015 } & \text { December } 31,2015\
\text { Equipment } & \$ 575,000 & \$ 729,000 \
\text { Accumulated depreciation } & \$ 165,000 & \$ 120,500
\end{array}$
• Equipment costing $25,000 was acquired in exchange for common stock.
• Equipment with an original cost of $57,500 and a book value of $5,000 was scrapped.
• Equipment was purchased in exchange for cash.
• Equipment with a book value of $39,000 was sold resulting in a $14,000 gain.The accumulated depreciation at the time of the sale was $67,000.
Required:
1.Determine the cash paid for equipment purchases during 2015.
2.Determine the depreciation expense for 2015.

Question

The Capitals Company has provided you the following information pertaining to the year ending December 31,2015:
 $\begin{array}{lll}&\text { January 1,2015 } & \text { December } 31,2015\
\text { Equipment } & \$ 575,000 & \$ 729,000 \
\text { Accumulated depreciation } & \$ 165,000 & \$ 120,500
\end{array}$ 
• Equipment costing $25,000 was acquired in exchange for common stock.
• Equipment with an original cost of $57,500 and a book value of $5,000 was scrapped.
• Equipment was purchased in exchange for cash.
• Equipment with a book value of $39,000 was sold resulting in a $14,000 gain.The accumulated depreciation at the time of the sale was $67,000.
Required:
1.Determine the cash paid for equipment purchases during 2015.
2.Determine the depreciation expense for 2015.

Quizplus · Accepted Answer

The Answer of The Capitals Company has provided you the following information pertaining to the year ending December 31,2015:
 $\begin{array}{lll}&\text { January 1,2015 } & \text { December } 31,2015\
\text { Equipment } & \$ 575,000 & \$ 729,000 \
\text { Accumulated depreciation } & \$ 165,000 & \$ 120,500
\end{array}$ 
• Equipment costing $25,000 was acquired in exchange for common stock.
• Equipment with an original cost of $57,500 and a book value of $5,000 was scrapped.
• Equipment was purchased in exchange for cash.
• Equipment with a book value of $39,000 was sold resulting in a $14,000 gain.The accumulated depreciation at the time of the sale was $67,000.
Required:
1.Determine the cash paid for equipment purchases during 2015.
2.Determine the depreciation expense for 2015.

The Capitals Company Has Provided You the Following Information Pertaining