1. Calculate the group depreciation rate, group life, and depreciation for 2024. 2. Prepare the journal entries to record the purchase of the new refrigerators and the sale of the old refrigerators.
1. Calculate the group depreciation rate, group life, and depreciation for 2024. 2. Prepare the journal entries to record the purchase of the new refrigerators and the sale of the old refrigerators.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Highsmith Rental Company purchased an apartment building early in 2024. There are 25 apartments in the building and each is
furnished with major kitchen appliances. The company has decided to use the group depreciation method for the appliances. The
following data are available:
Appliance
Stoves
Refrigerators
Dishwashers
Cost
$ 53,000
48,000
46,000
Residual
Value
$ 5,000
2,000
1,000
Service Life
(in Years)
In 2027, two new refrigerators costing $4,600 were purchased for cash. In that same year, the old refrigerators, which originally cost
$5,300, were sold for $2,100.
Required:
6
5
4
1. Calculate the group depreciation rate, group life, and depreciation for 2024.
2. Prepare the journal entries to record the purchase of the new refrigerators and the sale of the old refrigerators.
Group depreciation rate
Group life
Depreciation for 2024 (Straight Line)
Complete this question by entering your answers in the tabs below.
Required 1 Required 2
Calculate the group depreciation rate, group life, and depreciation for 2024.
Note: Round "Group depreciation rate" and "Group life" answers to 2 decimal places.
%
years
< Required 1
Required 2 >
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