Jing Company was started on January 1, 2016 when it issued common stock for $34,000 cash. Also, on January 1, 2016 the company purchased office equipment that cost $15,800 cash. The equipment was delivered under terms FOB shipping point, and transportation cost was $1,900. The equipment had a five-year useful life and a $5,600 expected salvage value.

3.

Using double-declining balance depreciation, determine the amount of depreciation expense and the amount of accumulated depreciation that would appear on the December 31, 2018 financial statements.

$0/$15,400.

$5,616/$14,976.

$772/$12,100.

$3,370/$18,770.

4.

Assume that Jing Company earned $22,200 cash revenue and incurred $14,000 in cash expenses in 2018. Using straight-line depreciation and assuming that the office equipment was sold on December 31, 2018 for $9,500, the amount of net income or (loss) appearing on the December 31, 2018 income statement would be:

($1,660).

$4,840.

$3,260.

$4,740.