3 On January 1, 2020 the Company purchased an equipment for $140,000 on credit and paid $10,000 for 28pts transportation of the equipment. The equipment has an estimated useful life of 5 years. Residual value is estimated as zero. The Company uses double declining method for depreciation. On December 31, 2021, the Company sold the equipment at $50,000 and collected. Prepare the journal entries for purchase and sale of the equipment. Q4 Trial Balance as of December 31, 2021 24pts Accounts Payable 3,500 a. Profit Margin show your calculation in the box below: Accounts Receivable 5,000 Accrued Salaries 1,000 Accumulated Depreciation 4,000 Bank Borrowings (due on May 31, 2022) 4,000 Bonds Payable (due on July 30, 2023) 4,800 Building 9,000 DATE ACCOUNT NAME DR CR Cash and Banks 2,000 Cost of Sales 21,000 January 1, 2020 purchase of an equipment dr Account Name dr Account Name cr Account Name cr Account Name Depreciation Expense 500 Equipment 3,000 Government Bonds (6 months maturity) 2,500 Income Accrual 1,400 Interest Expense 2,500 Interest Income 1.200 Inventories 4,000 Prepaid Rent (for January & February 2022) 1,000 c. Receivable Turnover show your calculation in the box below: December 31, 2021 sale of the equipment Rent Expense 2,000 Salary Expense 4,000 dr Account Name dr Account Name dr cr cr Account Name Account Name Account Name Sales Share Capital Softwares Tax Charge Unearned Income (deferrred income) 30,000 10,000 1,500 600 1,500 cr Account Name Calculate following ratios (show your calculation) Show your calculations in the box below: a. Profit margin b. Current ratio c. Receivable turnover (accounts receivable as of 31.12.2019 is $7,000) d. Inventory turnover (inventory as of 31.12.2019 is $3,000) Activate Windows Go to Settings to activate Windows