Answer:
<em>Detailed Question lifted from google: </em>
<em>Use the information presented below for Chambersburg Corp for 2017 and </em>
<em>2016 to answer the questions that follow. Chambersburg uses the straight-line depreciation method. 2017 2016 Property, plant, and equipment $ 250,000 $190,000 Accumulated depreciation 100,000 85,000 Depreciation expense 62,500 47,500 Net sales 1,000,000 900,000 Average Total assets 625,000 475,000 Refer to the information for</em>
<em>Chambersburg Corp Between 2016 and 2017, Chambersburg sold some equipment that had an original cost of $57,500 . Which statement is most likely true concerning transactions that must have occurred during the period?
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<em>a. Chambersburg also purchased additional equipment during the year.
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<em> b. The selling price of the equipment sold was reported with net sales.
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<em> c. The equipment that was sold had a book value of $12,500.
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<em> d. The equipment sold had not been reported with Chambersburg's property, plant and equipment.</em>
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The only applicable answer based on the question is A, <em>Chambersburg also purchased additional equipment during the year.
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Explanation:
A. Between 2016 and 2017 <em>Property, plant, and equipment increased by $60,000 (which is $250,000 minus $190,000)</em>
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B. Between 2016 and 2017 Depreciation expense on <em>Property, plant, and equipment increased by $15,000 (which is $62,500 minus $47,500)</em>
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<em>Meaning attributable depreciation to the new addition to PPE of $60,000 is actually $15,000.</em>
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