Assume that Sm's Auto Sales paid $45.000 for equipment with a 15-year ile and zero expected residual value. After using the equipment for six years, the company determines that the asset will remain useful for only five more years Read the resumects Requirement 1, Record depreciation expense on the equipment for Year 7 by the straight-ine method First, select the formula to calculate the company's revised depreciation expense on the equipment for Year 7. Then enter the amounts and calculate the depreciation for Year Book value 45000 Date Residual value 3+ Recond the depreciation on the equipment for Year 7. (Record debts first, then credits Select the explanation on the last line of the joumal entry table) Accounts and Explanation Debi Credit depreciation Requirement 2. What is accumulated depreciation at the end of Year 77 The accumulated depreciation at the end of Year 7 is
Assume that Sm's Auto Sales paid $45.000 for equipment with a 15-year ile and zero expected residual value. After using the equipment for six years, the company determines that the asset will remain useful for only five more years Read the resumects Requirement 1, Record depreciation expense on the equipment for Year 7 by the straight-ine method First, select the formula to calculate the company's revised depreciation expense on the equipment for Year 7. Then enter the amounts and calculate the depreciation for Year Book value 45000 Date Residual value 3+ Recond the depreciation on the equipment for Year 7. (Record debts first, then credits Select the explanation on the last line of the joumal entry table) Accounts and Explanation Debi Credit depreciation Requirement 2. What is accumulated depreciation at the end of Year 77 The accumulated depreciation at the end of Year 7 is
Chapter1: Financial Statements And Business Decisions
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Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
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Transcribed Image Text:Assume that Sm's Auto Sales paid $45.000 for equipment with a 15-year ile and zero expected residual value. After using the equipment for six years, the company determines that the asset will
remain useful for only five more years
Read the resumects
Requirement 1, Record depreciation expense on the equipment for Year 7 by the straight-ine method
First, select the formula to calculate the company's revised depreciation expense on the equipment for Year 7. Then enter the amounts and calculate the depreciation for Year
Book value
45000
Date
Residual value
3+
Recond the depreciation on the equipment for Year 7. (Record debts first, then credits Select the explanation on the last line of the joumal entry table)
Accounts and Explanation
Debi
Credit
depreciation
Requirement 2. What is accumulated depreciation at the end of Year 77
The accumulated depreciation at the end of Year 7 is
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