Ding Company was started on January 1, Year 1 when it issued common stock for $43,000 cash. Also, on January 1, Year 1 the company purchased office equipment that cost $18,300 cash. The equipment was delivered under terms FOB shipping point, and transportation cost was $2,800. The equipment had a five-year useful life and a $6,800 expected salvage value. Assume that Jing Company earned $29,400 cash revenue and incurred $18,500 in cash expenses in Year 3. Using straight- line depreciation and assuming that the office equipment was sold on December 31, Year 3 for $10,400, the amount of net income or (loss) appearing on the December 31, Year 3 income statement would be: Multiple Choice ($3,020).

Ding Company was started on January 1, Year 1 when it issued common stock for $43,000 cash. Also, on January 1, Year 1 the company purchased office equipment that cost $18,300 cash. The equipment was delivered under terms FOB shipping point, and transportation cost was $2,800. The equipment had a five-year useful life and a $6,800 expected salvage value. Assume that Jing Company earned $29,400 cash revenue and incurred $18,500 in cash expenses in Year 3. Using straight- line depreciation and assuming that the office equipment was sold on December 31, Year 3 for $10,400, the amount of net income or (loss) appearing on the December 31, Year 3 income statement would be: Multiple Choice ($3,020).

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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