Meubles Fischer SA had the following balances for its property, plant and equipment accounts (in thousands of euros):
September 30, 2015 |
September 30, 2016 |
|
---|---|---|
Property, plant and equipment at cost | €1,000 | €1,200 |
Accumulated depreciation | (350) | (390) |
Property, plant and equipment, net | €650 | €810 |
During fiscal year 2016, Meubles Fischer acquired €110 thousand in property by signing a mortgage, plus another €310 thousand in equipment for cash. The company also received €110 in cash from the sale of used equipment, and its income statement reveals a €30 thousand gain from this transaction.
a. | What was the original cost of the used equipment that Meubles Fischer SA sold during fiscal year 2016? | |
€Answer thousand | ||
b. | How much depreciation had been accumulated on the used equipment at the time it was sold? | |
€Answer thousand | ||
c. | How much depreciation expense did Meubles Fischer SA recognize in its fiscal year 2016 income statement? | |
€Answer thousand |
a. Original cost of the equipment sold:
Property,plant and equipment at cost: | |
Beginning balance | 1,000 |
Purchases (110+310) | 420 |
Less: Ending balance | (1,200) |
Original cost of sold equipment | 220 |
b. Accumulated depreciation on the equipment sold:
Cash received from the sale | 110 |
Less: Gain on sale of equipment | ($30) |
Book value of the sold equipment | 80 |
Original cost of the equipment that sold | 220 |
Less: Book value of the equipment that sold | (80) |
Accumulated depreciation on sold equipment | 140 |
c.Depreciation Expense for 2016 income statement:
Accumulated depreciation: | |
Ending balance | 390 |
Accumulated depreciation on sold equipment | 140 |
Less: beginning balance | (350) |
Depreciation expense | 180 |
Meubles Fischer SA had the following balances for its property, plant and equipment accounts (in thousands...
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