Questions: Which of the following statements is (are) accurate regarding equipment purchased within a business? (Check all that apply.) Equipment purchases are reported on the balance sheet. Equipment is an asset. Equipment is reported on the left side of the accounting equation. Equipment cost is initially recorded as an asset and the cost is allocated over time to expense. Equipment purchases are expensed, in their entirety, in the period in which they occur.

The accurate statements regarding equipment purchased within a business are:

1. Equipment purchases are reported on the balance sheet.

   • Explanation: This statement is correct. Equipment is considered a long-term asset and is reported on the balance sheet under property, plant, and equipment.

2. Equipment is an asset.

   • Explanation: This statement is correct. Equipment is classified as a tangible asset because it is a resource owned by the business that is expected to provide future economic benefits.

3. Equipment is reported on the left side of the accounting equation.

   • Explanation: This statement is correct. The accounting equation is Assets = Liabilities + Equity. Assets, including equipment, are reported on the left side of this equation.

4. Equipment cost is initially recorded as an asset and the cost is allocated over time to expense.

   • Explanation: This statement is correct. When equipment is purchased, it is recorded as an asset. Over time, the cost is allocated to expense through depreciation.

5. Equipment purchases are expensed, in their entirety, in the period in which they occur.

   • Explanation: This statement is incorrect. Equipment purchases are not expensed in their entirety in the period they occur. Instead, they are capitalized as assets and depreciated over their useful life.

In summary, the accurate statements are the first four: Equipment purchases are reported on the balance sheet, equipment is an asset, equipment is reported on the left side of the accounting equation, and equipment cost is initially recorded as an asset and the cost is allocated over time to expense.