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Problem 1: Emerald Co. owned equipment with a book value of $127,500 that was sold during this accounting period for $31,900 in cash, and purchased new equipment for cash of $148,700. Emerald Co. would record a debit of:
Multiple Choice Option 1: $148,700 and a credit of $31,900 to the cash account for a net cash inflow of $116,800. Option 2: $148,700 and a credit of $95,600 to the cash account for a net cash inflow of $53,100. Option 3: $31,900 and a credit of $148,700 to the cash account for a net cash outflow of $116,800. Option 4: $95,600 and a credit of $148,700 to the cash account for a net cash outflow of $53,100.
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