Reference no: EM132759899
Below is the balance sheet of Blue Inc. for the years 2017 and 2018.
December 31, 2018 Dec. 31, 2017
Cash ................................................... $ 6,000 $ 9,000
Accounts receivable ........................... 8,000 12,000
Merchandise inventory ......................... 20,000 18,000
Prepaid rent ....................................... 6,000 4,000
Equipment .......................................... 105,000 80,000
Accumulated depreciation ..................... (24,000) (13,000)
Total assets .......................................... $121,000 $110,000
Accounts payable ................................. $ 5,000 $ 25,000
Dividends payable .............................. 7,000 4,000
Common stock .................................... 35,000 30,000
Additional Paid in Capital, common stock ...... 6,000 68,000
Retained earnings .................................... 2,000 49,000
Total liabilities and stockholders' equity ......... $121,000 $110,000
Other information:
- No equipment was sold or retired during 2018.
- Brown's net income for 2018 was $63,000.
Use the information above & calculate:
Problem a. Determine the cost of equipment purchased during 2018.
Problem b. The amount of depreciation expense charged/recognized for the year 2018
Problem c. How much cash was paid for depreciation in 2018?