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"roposal 1: Transfer equipment with a book value of $313,000 to other divisions at no gain or loss and lease similar equipment. The annual lease payments would exceed the amount f depreciation expense on the old equipment by $108,000. This increase in expense would be included as part of the cost of goods sold. Sales would remain unchanged.

"roposal 1: Transfer equipment with a book value of $313,000 to other divisions at no gain or loss and lease similar equipment. The annual lease payments would exceed the amount f depreciation expense on the old equipment by $108,000. This increase in expense would be included as part of the cost of goods sold. Sales would remain unchanged.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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"roposal 1: Transfer equipment with a book value of $313,000 to other divisions at no gain or loss and lease similar equipment. The annual lease payments would exceed the amount f depreciation expense on the old equipment by $108,000. This increase in expense would be included as part of the cost of goods sold. Sales would remain unchanged.
Transcribed Image Text:"roposal 1: Transfer equipment with a book value of $313,000 to other divisions at no gain or loss and lease similar equipment. The annual lease payments would exceed the amount f depreciation expense on the old equipment by $108,000. This increase in expense would be included as part of the cost of goods sold. Sales would remain unchanged.
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