Cash flows for financing and investing The following data are extracted from the financial statements of Hippolyta Ltd.

2022 2021

$ $

Equipment 128 000 192 000 Accumulated depreciation – equipment (35 000) (40 000)

Additional information:

a Proceeds from sale of equipment, $75 000 b Net book value (cost less accumulated depreciation) of equipment sold, $62 000 c Depreciation expense for equipment, $17 000 d Some new equipment was purchased during 2022 e Assume all sales and purchases of equipment are for cash Required:

1 Reconstruct the journal entry to record the sale of equipment.

2 What is the value of the equipment purchased?