Adjusting entries are a. Used only by company's employing a cash basis of accounting b. Prepared after the financial statements are prepared c. Commonly called closing entries d. Needed to properly measure a period's income Equipment was purchased for $10,000. Freight charges amounted to $500 and there was a cost of $1,500 for building a foundation and installation of the equipment. It is estimated that the equipment will have a $2,500 salvage value at the end of its 5-year useful life. Depreciation expense each year using the straight-line method will be: a. $2,000 b. $1,600 c. $1,900 d. $1,500