Bowyer Driving School's 2014 balance sheet showed net fixed assets of $3 million, and the 2015 balance sheet showed net fixed assets of $3.7 million. The company's 2015 income statement showed a depreciation expense of $200,000. What was net capital spending for 2015? (Do not round intermediate calculations. Enter your answer in dollars, not millions of dollars, e. g., 1,234,567.)

Question

Business

Adolfo Ochoa

25 December, 22:06

Bowyer Driving School's 2014 balance sheet showed net fixed assets of $3 million, and the 2015 balance sheet showed net fixed assets of $3.7 million. The company's 2015 income statement showed a depreciation expense of $200,000. What was net capital spending for 2015? (Do not round intermediate calculations. Enter your answer in dollars, not millions of dollars, e. g., 1,234,567.)

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Serena Bullock · Answer 1

Answer: $900,000

Explanation:

Net fixed assets (2014) = $3 million

Net fixed assets (2015) = $3.7 million

Depreciation expense = $200,000

Net capital spending for 2015 = closing balance of 2015 - opening balance of assets + depreciation for the year

= $3,700,000 - $3,000,000 + $200,000

= $900,000

Therefore, the net capital spending for the year 2015 is $900,000.