On 1/1, Florida Power and Light Energy bought a single piece of equipment by paying $7,000 cash. They also incurred freight charges and taxes of $224 on 1/1 and paid for these items with cash, also. The market value of this equipment is $13,000. What amount should be recorded in Florida Power and Light's Equipment Account on 1/1?

the amount that should be recorded in Florida Power and Light's Equipment Account on 1/1 is $7,224

Explanation:

The computation of the amount that should be recorded in Florida Power and Light's Equipment Account on 1/1 is shown below:

= Purchase price of an equipment + freight charges & taxes

= $7,000 + $224

= $7,224

Hence, the amount that should be recorded in Florida Power and Light's Equipment Account on 1/1 is $7,224

income statement is prepared in order to show the profits and loss of a business. in order to prepare the income statement she should collect all the income and expenses of the product with the cost of production.