During the year an enterprise fund purchased $230,000 worth of equipment. The equipment was acquired with a cash down payment of $30,000 and a $200,000 loan. A partial year of depreciation on the equipment was taken in the amount of $23,000. What is the net effect of this transaction on the net position accounts of the enterprise fund?

Question

Jorge Baxter

Business

1 September, 09:47

During the year an enterprise fund purchased $230,000 worth of equipment. The equipment was acquired with a cash down payment of $30,000 and a $200,000 loan. A partial year of depreciation on the equipment was taken in the amount of $23,000. What is the net effect of this transaction on the net position accounts of the enterprise fund?

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Answers (1)

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Elian Clarke · Answer 1

The net investment in capital assets is increased by $7,000.

Explanation:

Details amount amount

equipment $230,000

Partial year-depreciation ($23,000)

Net value of the equipment $207,000

acquired load ($200,000)

increase in capital assets $7,000

Therefore, The net effect of this transaction on the net position accounts of the enterprise fund is, The net investment in capital assets is increased by $7,000.