NICO Corporation had net fixed assets of $2,000,000 at the end of 2015 and $1,800,000 at the end of 2014. In addition, the firm had a depreciation expense of $200,000 during 2015 and $180,000 during 2014. Using this information, NICO's net fixed asset investment for 2015 was ________.
A) $20,000
B) $0
C) $380,000
D) $400,000

Question

Quizplus · Accepted Answer

Net fixed asset investment for the year is the change in net fixed assets adjusted for depreciation expense. Therefore, the calculation is:
Net fixed asset investment for 2015 = (Net fixed assets at the end of 2015 - Net fixed assets at the end of 2014) + Depreciation expense for 2015
Net fixed asset investment for 2015 = ($2,000,000 - $1,800,000) + $200,000 = $400,000. Therefore, the correct choice is D.

NICO Corporation Had Net Fixed Assets of $2,000,000 at the End