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(b) Prepare all required journal entries (if any) at December 31, 2021. The fair value of the equipment at December 31, 2021, is estimated to be $6,608,000. (If no entry is required, select "No entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

(b) Prepare all required journal entries (if any) at December 31, 2021. The fair value of the equipment at December 31, 2021, is estimated to be $6,608,000. (If no entry is required, select "No entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

FINANCIAL ACCOUNTING
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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(b) Prepare all required journal entries (if any) at December 31, 2021. The fair value of the equipment at December 31, 2021, is estimated to be $6,608,000. (If no entry is required, select "No entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Dec. 31 D
Transcribed Image Text:(b) Prepare all required journal entries (if any) at December 31, 2021. The fair value of the equipment at December 31, 2021, is estimated to be $6,608,000. (If no entry is required, select "No entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Dec. 31 D
Coronado Company uses special strapping equipment in its packaging business. The equipment was purchased in January 2019 for $11,200,000 and had an estimated useful life of 8 years with no salvage value. At December 31, 2020, new technology was introduced that would accelerate the obsolescence of Coronado's equipment. Coronado's controller estimates that expected future net cash flows on the equipment will be $7,056,000 and that the fair value of the equipment is $6,272,000. Coronado intends to continue using the equipment, but it is estimated that the remaining useful life is 4 years. Coronado uses straight-line depreciation.
Transcribed Image Text:Coronado Company uses special strapping equipment in its packaging business. The equipment was purchased in January 2019 for $11,200,000 and had an estimated useful life of 8 years with no salvage value. At December 31, 2020, new technology was introduced that would accelerate the obsolescence of Coronado's equipment. Coronado's controller estimates that expected future net cash flows on the equipment will be $7,056,000 and that the fair value of the equipment is $6,272,000. Coronado intends to continue using the equipment, but it is estimated that the remaining useful life is 4 years. Coronado uses straight-line depreciation.
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