At the beginning of the year, Plummer's Sports Center bought three used fitness machines from Primo Fitness, an established supplier of used, new and refurbished gym equipment in Southern California. The machines immediately were overhauled and started operating. The machines were different; therefore, each had to be recorded separately in the accounts. Invoice price paid for asset Shipping costs (paid by Plummer) Renovation costs prior to use Machine Machine Machine с A B $11,000 $30,000 $8,000 500 1,000 500 2,500 1,000 1,500 By the end of the first year, each machine had been operating 4,800 hours. 2. Prepare the entry to record depreciation expense at the end of Year 1, assuming the following. Note: Do not round intermediate calculations. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
At the beginning of the year, Plummer's Sports Center bought three used fitness machines from Primo Fitness, an established supplier of used, new and refurbished gym equipment in Southern California. The machines immediately were overhauled and started operating. The machines were different; therefore, each had to be recorded separately in the accounts. Invoice price paid for asset Shipping costs (paid by Plummer) Renovation costs prior to use Machine Machine Machine с A B $11,000 $30,000 $8,000 500 1,000 500 2,500 1,000 1,500 By the end of the first year, each machine had been operating 4,800 hours. 2. Prepare the entry to record depreciation expense at the end of Year 1, assuming the following. Note: Do not round intermediate calculations. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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At the beginning of the year, Plummer's Sports Center bought three used fitness machines from Primo
Fitness, an established supplier of used, new and refurbished gym equipment in Southern California. The
machines immediately were overhauled and started operating. The machines were different; therefore, each
had to be recorded separately in the accounts.
Machine Machine Machine
A
B
C
Invoice price paid for $11,000 $30,000 $8,000
asset
Shipping costs (paid by
Plummer)
500 1,000
500
Renovation costs prior
2,500
1,000 1,500
to use
By the end of the first year, each machine had been operating 4,800 hours.
2. Prepare the entry to record depreciation expense at the end of Year 1, assuming the following.
Note: Do not round intermediate calculations. If no entry is required for a transaction/event, select "No journal entry
required" in the first account field.
ESTIMATES
Residual
Machine
Life
Value
Depreciation
Method
A
5 years
$1,000
Straight-line
60,000
Units-of-
B
2,000
hours
production
Double-declining-
с
4 years
1,500
balance
View transaction list
Journal entry worksheet
1
Record the depreciation expense for year 1.
Note: Enter debits before credits.
Transaction
a
General Journal
Debit Credit
Record entry
View general journal
Clear entry](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F69310af9-b29b-46ee-bcfe-5e8fc46bf0c1%2F6f2bef28-cc7d-4341-b7be-698073e8ed66%2Fk5fuymr_processed.jpeg&w=3840&q=75)
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Required information
[The following information applies to the questions displayed below.]
At the beginning of the year, Plummer's Sports Center bought three used fitness machines from Primo
Fitness, an established supplier of used, new and refurbished gym equipment in Southern California. The
machines immediately were overhauled and started operating. The machines were different; therefore, each
had to be recorded separately in the accounts.
Machine Machine Machine
A
B
C
Invoice price paid for $11,000 $30,000 $8,000
asset
Shipping costs (paid by
Plummer)
500 1,000
500
Renovation costs prior
2,500
1,000 1,500
to use
By the end of the first year, each machine had been operating 4,800 hours.
2. Prepare the entry to record depreciation expense at the end of Year 1, assuming the following.
Note: Do not round intermediate calculations. If no entry is required for a transaction/event, select "No journal entry
required" in the first account field.
ESTIMATES
Residual
Machine
Life
Value
Depreciation
Method
A
5 years
$1,000
Straight-line
60,000
Units-of-
B
2,000
hours
production
Double-declining-
с
4 years
1,500
balance
View transaction list
Journal entry worksheet
1
Record the depreciation expense for year 1.
Note: Enter debits before credits.
Transaction
a
General Journal
Debit Credit
Record entry
View general journal
Clear entry
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Step 1: Introduction to depreciation:
VIEWStep 2: Working note 1- Calculation of total cost of three machines:
VIEWStep 3: Working note 2- Calculation of depreciation expense for Machine A in year 1 using straight-line:
VIEWStep 4: Working note 3- Determining depreciation expense for Machine B in year 1 using units-of-production:
VIEWStep 5: Working note 4- Determining depreciation expense for Machine C using double-declining-balance:
VIEWStep 6: Requirement 2- Preparing the journal entry to record depreciation expense in year 1:
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