Intermediate Accounting I

12. On 1/2/20, Rechev Corp purchased equipment for $75,000. Rechev also paid $2,000 for shipping the equipment to its business location and $4,000 for setup. The equipment malfunctioned two weeks after being placed in service, necessitating an additional outlay of $3,500. How much was the balance in the equipment account after all those costs were incurred?

a) $81,000

b) $84,500

c) $75,000

d) $77,000