Answer :
Answer:
From indications, it is clear that the requirement is showing the impact of the transactions in the balance sheet and income statement under relevant line items.
Balance sheet extract:
Equipment at cost $250000
accumulated depreciation($150000)
Net book value $100000
Income statement extract:
Depreciation expense ($30000)
Explanation:
The balance sheet would show equipment net book value of $100000(Cost less accumulated depreciation)
The income statement would show depreciation expense of $30000
There is no impact on liabilities as the no obligation to pay another party a sum of money was present in the scenario.
Also, there is no direct impact on stockholders,the only indirect impact is that the retained earnings would have been reduced by depreciation.
Answer:
The equipment that had a cost of 250.000 is consider to be an asset, so the assets would have an increase of $ 250,000. This account appears on the balance sheet.
The company has recorded $ 30,000 of depreciation, which means that 30,000 is considered as en expense on the income statement.
The accumulate depreciated of 150,000, is an asset account with a credit balance, which means that the account that appears on the Balance Sheet is Accumulated Depreciation of $ -150,000
Explanation:
In conclusion:
Balance Sheet
Assets Income Statement
Equipment $ 250,000 Expenses
Accumulated Depreciation $ -150,000 Depreciated Expense $ 30,000
There are no transaction regarding revenues, liabiliaties, stockholders, to record.