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Homework answers / question archive / Financial statements are prepared from a(n) a
Financial statements are prepared from a(n)
a. trial balance
b. general ledger
c. chart of accounts
d. journal entries
A company buys an oil rig for $1,500,000 on January 1, 2014. The life of the rig is 10 years and the expected cost to dismantle the rig at the end of 10 years is $400,000 (present value at 10% is $154,220). 10% is an appropriate interest rate for this company. What expense should be recorded for 2014 as a result of these events?
a. Depreciation expense of $190,000
b. Depreciation expense of $165,422 and interest expense of $15,422
c. Depreciation expense of $150,000 and interest expense of $40,000
d. Depreciation expense of $215,422 and interest expense of $15,422
Answer) option a
Trial balance
First journal entries are passed for the transactions then ledger prepared from the entries.next trial balance prepared from where all the financial statements are prepared
please find attached.
