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Do-Good Inc.is a newly formed not-for-profit organization.On January,2012,its first day of operations,Do-Good purchased equipment costing $8,000.The equipment is estimated to have a useful life of 4 years,with no residual value at that time.This transaction was the only transaction that took place to date.
For question 14 through 16,assume that the equipment was purchased from a restricted fund contribution of $8,400.
-What would be the carrying value of the equipment on December 31,2012?

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The carrying value of the equipment on December 31, 2012, would be $6,000. This is calculated by taking the initial cost of $8,000 and subtracting one year's depreciation. With a useful life of 4 years, the annual depreciation is $2,000 ($8,000/4). Therefore, $8,000 - $2,000 = $6,000. The restricted fund contribution amount does not affect the carrying value.

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