A machine costing $171,600 was destroyed when it caught fire. At the date of the fire, the accumulated depreciation on the machine was $84,000. An insurance check for $203,800 was received based on the replacement cost of the machine. The entry to record the insurance proceeds and the disposition of the machine will include a: a) gain on disposal of $116,200. b) credit to the Equipment account for $119,800. c) gain on disposal of $32,200. d) credit to the Accumulated Depreciation account for $84,000. On January 1, 2013 Williams Company purchased a copyright for $220,000. The copyright has a useful life of 4 years and a legal life of 12 years. The entry to record the acquisition of copyright will include a: a. debit to cash and credit to copyright for $220,000 b. debit to copyright and credit to cash for $220,000 c. debit amortization expense and credit to copyright for $55,000 d. debit to goodwill and credit to cash for $55,000 e. debit to cash and credit to purchases for $220,000
A machine costing $171,600 was destroyed when it caught fire. At the date of the fire, the accumulated depreciation on the machine was $84,000. An insurance check for $203,800 was received based on the replacement cost of the machine. The entry to record the insurance proceeds and the disposition of the machine will include a: a) gain on disposal of $116,200. b) credit to the Equipment account for $119,800. c) gain on disposal of $32,200. d) credit to the Accumulated Depreciation account for $84,000. On January 1, 2013 Williams Company purchased a copyright for $220,000. The copyright has a useful life of 4 years and a legal life of 12 years. The entry to record the acquisition of copyright will include a: a. debit to cash and credit to copyright for $220,000 b. debit to copyright and credit to cash for $220,000 c. debit amortization expense and credit to copyright for $55,000 d. debit to goodwill and credit to cash for $55,000 e. debit to cash and credit to purchases for $220,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:A machine costing $171,600 was destroyed when it caught fire. At the date of the fire,
the accumulated depreciation on the machine was $84,000. An insurance check for
$203,800 was received based on the replacement cost of the machine. The entry to
record the insurance proceeds and the disposition of the machine will include a:
a) gain on disposal of $116,200.
b) credit to the Equipment account for $119,800.
c) gain on disposal of $32,200.
d) credit to the Accumulated Depreciation account for $84,000.
On January 1, 2013 Williams Company purchased a copyright for $220,000. The
copyright has a useful life of 4 years and a legal life of 12 years. The entry to record the
acquisition of copyright will include a:
a. debit to cash and credit to copyright for $220,000
b. debit to copyright and credit to cash for $220,000
c. debit amortization expense and credit to copyright for $55,000
d. debit to goodwill and credit to cash for $55,000
e. debit to cash and credit to purchases for $220,000
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