### Journal Entries for Carpet Purchase and Depreciation**Scenario:** Champion Company purchased and installed carpet in its new general offices on March 31 for a total cost of $18,000. The carpet is estimated to have a 15-year useful life and no residual value.#### Task:1. **Record the Journal Entries for the Carpet Purchase** **Date:** March 31 - **Debit:** Asset (Carpet Purchase) - \$18,000 - **Credit:** Cash/Accounts Payable - \$18,000 2. **Record the Adjusting Entry for Depreciation Expense** **Date:** December 31 - **Depreciation Method:** Straight-Line - **Annual Depreciation Expense:** Total Cost / Useful Life = \$18,000 / 15 = \$1,200 - **Partial-Year Depreciation (from March 31 to December 31):** $\frac{9}{12} \times \$1,200 = \$900$ - **Debit:** Depreciation Expense - \$900 - **Credit:** Accumulated Depreciation - \$900 **Importance:** This exercise helps understand basic accounting entries for acquiring and depreciating fixed assets. It illustrates the use of the straight-line depreciation method and emphasizes the need for adjusting entries at year-end to reflect accurate financial statements.

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Description: ### Journal Entries for Carpet Purchase and Depreciation**Scenario:** Champion Company purchased and installed carpet in its new general offices on March 31 for a total cost of $18,000. The carpet is estimated to have a 15-year useful life and no re

Journal Entry for Purchase of Asset: Before moving on to the journal entry, let us first discuss the…

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4. EX 09.204 Champion Company purchased and installed carpet in its new general offices on March 31 for a total cost of $18,000. The carpet is estimated to have a 15-year useful life and no residual value. a. Prepare the journal entries necessary for recording the purchase of the new carpet. If an amount box does not require an entry, leave it blank. Mar. 31 b. Record the December 31 adjusting entry for the partial-year depreciation expense for the carpet assuming that Champion Company uses the straight-line method. If an amount box does not require an entry, leave it blank. Dec. 31

4. EX 09.204 Champion Company purchased and installed carpet in its new general offices on March 31 for a total cost of $18,000. The carpet is estimated to have a 15-year useful life and no residual value. a. Prepare the journal entries necessary for recording the purchase of the new carpet. If an amount box does not require an entry, leave it blank. Mar. 31 b. Record the December 31 adjusting entry for the partial-year depreciation expense for the carpet assuming that Champion Company uses the straight-line method. If an amount box does not require an entry, leave it blank. Dec. 31

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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