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Chem-Lite Incorporated, maintains its accounts on the basis of a fiscal year ending March 31. At March 31, 20X1, the Equipment account in the general ledger appeared as shown below. The company uses straight-line depreciation, a 10-year life, and 10 percent salvage value for all its equipment. It is the company's policy to take a full year's depreciation on all additions to equipment occurring during the fiscal year, and you may treat this policy as a satisfactory one for the purpose of this problem. The company has recorded depreciation for the fiscal year ended March 31, 20X1. 270,000 12, 200 1,189 1,189 1,189 Upon further investigation, you find the following contract dated December 1, 20X0, covering the acquisition of equipment: List price 5% sales tax $34,000 1,700 $35,700 Total 12,200 23,500 4,230 $27,730 Equipment 4/1/X0 Bal. forward 12/1/X0 1/2/X1 2/1/X1 3/1/X1 Down payment Balance 9% interest, 24 months Contract amount

Chem-Lite Incorporated, maintains its accounts on the basis of a fiscal year ending March 31. At March 31, 20X1, the Equipment account in the general ledger appeared as shown below. The company uses straight-line depreciation, a 10-year life, and 10 percent salvage value for all its equipment. It is the company's policy to take a full year's depreciation on all additions to equipment occurring during the fiscal year, and you may treat this policy as a satisfactory one for the purpose of this problem. The company has recorded depreciation for the fiscal year ended March 31, 20X1. 270,000 12, 200 1,189 1,189 1,189 Upon further investigation, you find the following contract dated December 1, 20X0, covering the acquisition of equipment: List price 5% sales tax $34,000 1,700 $35,700 Total 12,200 23,500 4,230 $27,730 Equipment 4/1/X0 Bal. forward 12/1/X0 1/2/X1 2/1/X1 3/1/X1 Down payment Balance 9% interest, 24 months Contract amount

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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Journal entry worksheet < A B Record the entry to correct the depreciation taken the equipment purchased under the installment contract originating on December 1, 20X0. Note: Enter debits before credits. Transaction 2 General Journal Debit Credit
Transcribed Image Text:Journal entry worksheet < A B Record the entry to correct the depreciation taken the equipment purchased under the installment contract originating on December 1, 20X0. Note: Enter debits before credits. Transaction 2 General Journal Debit Credit
Chem-Lite Incorporated, maintains its accounts on the basis of a fiscal year ending March 31. At March 31, 20X1, the Equipment account in the general ledger appeared as shown below. The company uses straight-line depreciation, a 10-year life, and 10 percent salvage value for all its equipment. It is the company's policy to take a full year's depreciation on all additions to equipment occurring during the fiscal year, and you may treat this policy as a satisfactory one for the purpose of this problem. The company has recorded depreciation for the fiscal year ended March 31, 20X1. Equipment 4/1/X0 Bal. forward 12/1/X0 1/2/X1 2/1/X1 3/1/X1 270,000 12,200 1,189 1,189 1,189 Upon further investigation, you find the following contract dated December 1, 20X0, covering the acquisition of equipment: List price 5% sales tax $34,000 1,700 $35,700 Total 12, 200 Down payment Balance 9% interest, 24 months Contract amount 23,500 4,230 $27,730
Transcribed Image Text:Chem-Lite Incorporated, maintains its accounts on the basis of a fiscal year ending March 31. At March 31, 20X1, the Equipment account in the general ledger appeared as shown below. The company uses straight-line depreciation, a 10-year life, and 10 percent salvage value for all its equipment. It is the company's policy to take a full year's depreciation on all additions to equipment occurring during the fiscal year, and you may treat this policy as a satisfactory one for the purpose of this problem. The company has recorded depreciation for the fiscal year ended March 31, 20X1. Equipment 4/1/X0 Bal. forward 12/1/X0 1/2/X1 2/1/X1 3/1/X1 270,000 12,200 1,189 1,189 1,189 Upon further investigation, you find the following contract dated December 1, 20X0, covering the acquisition of equipment: List price 5% sales tax $34,000 1,700 $35,700 Total 12, 200 Down payment Balance 9% interest, 24 months Contract amount 23,500 4,230 $27,730
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