On its December 31 prior year balance sheet, Calgary Industries reports equipment of $540,000 and accumulated depreciation of $91,000. During the current year, the company plans to purchase additional equipment costing $97,000 and expects depreciation expense of $47,000. Additionally, it plans to dispose of equipment that originally cost $59,000 and had accumulated depreciation of $7,300. The balances for equipment and accumulated depreciation, respectively, on its December 31 current year budgeted balance sheet are: Multiple Choice $578,000: $138,000. $481,000, $91,000 $637,000; $130,700. $637,000; $138,000. $578,000, $130,700.

On its December 31 prior year balance sheet, Calgary Industries reports equipment of $540,000 and accumulated depreciation of $91,000. During the current year, the company plans to purchase additional equipment costing $97,000 and expects depreciation expense of $47,000. Additionally, it plans to dispose of equipment that originally cost $59,000 and had accumulated depreciation of $7,300. The balances for equipment and accumulated depreciation, respectively, on its December 31 current year budgeted balance sheet are: Multiple Choice $578,000: $138,000. $481,000, $91,000 $637,000; $130,700. $637,000; $138,000. $578,000, $130,700.

Name: On its December 31 prior year balance sheet, Calgary Industries repor
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Description: On its December 31 prior year balance sheet, Calgary Industries reports equipment of $540,000 and accumulated depreciation of $91,000. During thecurrent year, the company plans to purchase additional equipment costing $97,000 and expects depreciatio

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Concept explainers

Depreciation Methods

The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.

Depreciation Accounting

In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.

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On its December 31 prior year balance sheet, Calgary Industries reports equipment of $540,000 and accumulated depreciation of $91,000. During the
current year, the company plans to purchase additional equipment costing $97,000 and expects depreciation expense of $47,000. Additionally, it plans
to dispose of equipment that originally cost $59,000 and had accumulated depreciation of $7,300. The balances for equipment and accumulated
depreciation, respectively, on its December 31 current year budgeted balance sheet are:
Multiple Choice
$578,000; $138,000.
$481,000, $91,000,
O $637,000; $130,700
$637,000; $138,000
$578,000, $130,700.

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