Tumble & Flip, Incorporated operates amusement parks in the United States and Canada. During 2018, it reported the following (in millions): From the income statement Loss on sale of equipment Depreciation expense From the balance sheet Equipment, beginning Equipment, ending i Accumulated depreciation, beginning Accumulated depreciation, ending Equipment costing $194 was purchased during the year. $ 10 167 (a) Original cost of equipment sold (b) Accumulated degreciation of the equipment sold (c) Cash received from sale 1,750 1,820 1,620 1,750 Required: For the equipment that was sold during the year, compute the following: (a) its original cost, (b) its accumulated depreciation, and (c) cash received from the sale. Note: Enter your answers in millions. $ in million
Tumble & Flip, Incorporated operates amusement parks in the United States and Canada. During 2018, it reported the following (in millions): From the income statement Loss on sale of equipment Depreciation expense From the balance sheet Equipment, beginning Equipment, ending i Accumulated depreciation, beginning Accumulated depreciation, ending Equipment costing $194 was purchased during the year. $ 10 167 (a) Original cost of equipment sold (b) Accumulated degreciation of the equipment sold (c) Cash received from sale 1,750 1,820 1,620 1,750 Required: For the equipment that was sold during the year, compute the following: (a) its original cost, (b) its accumulated depreciation, and (c) cash received from the sale. Note: Enter your answers in millions. $ in million
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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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Subject : Accounting
Transcribed Image Text:Tumble & Flip, Incorporated operates amusement parks in the United States and Canada. During 2018, it reported the following (in
millions):
From the income statement
Loss on sale of equipment
Depreciation expense
From the balance sheet
Equipment, beginning
Equipment, ending i
Accumulated depreciation, beginning
Accumulated depreciation, ending
Equipment costing $194 was purchased during the year.
$ 10
167
(a) Original cost of equipment sold
(b) Accumulated degreciation of the equipment sold
(c) Cash received from sale i
1,750
1,820
1,620
1,750
Required:
For the equipment that was sold during the year, compute the following: (a) its original cost, (b) its accumulated depreciation, and (c)
cash received from the sale.
Note: Enter your answers in millions.
$ in million
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