CFA CFA Level 1 Question of the Week – Financial Reporting and Analysis

Question of the Week – Financial Reporting and Analysis

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    • Avatar of AdaptPrepAdaptPrep
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        A company had equipment worth $50 million on 1 January. During the year, they purchased equipment for $10 million. On 31 December, the equipment account showed $40 million. All figures are shown at cost, before depreciation. The amount of equipment sold during the end of the year, at cost, would be closest to:

        • $0
        • $20 million
        • $40 million
      • Avatar of AdaptPrepAdaptPrep
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          Beginning equipment balance = 50

          Plus equipment purchased = 10

          Less ending equipment balance =
          (40)

          Historic cost of equipment sold =
          20

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