Crane Company had the following assets on January 1, 2022. Useful Life (in years) Item Machinery Forklift Truck Cost $59,000 18,000 24,400 Purchase Date Jan 1, 2012 Jan 1, 2019 Jan 1, 2017 10 5 8 Salvage Value $0 0 3,000 During 2022, each of the assets was removed from service. The machinery was retired on January 1. The forklift was sold on June 30 for $10,800. The truck was discarded on December 31. Journalize all entries required on the above dates, including entries to update depreciation, where applicable, on disposed assets. The company uses straight-line depreciation. All depreciation was up to date as of December 31, 2021. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.)
Crane Company had the following assets on January 1, 2022. Useful Life (in years) Item Machinery Forklift Truck Cost $59,000 18,000 24,400 Purchase Date Jan 1, 2012 Jan 1, 2019 Jan 1, 2017 10 5 8 Salvage Value $0 0 3,000 During 2022, each of the assets was removed from service. The machinery was retired on January 1. The forklift was sold on June 30 for $10,800. The truck was discarded on December 31. Journalize all entries required on the above dates, including entries to update depreciation, where applicable, on disposed assets. The company uses straight-line depreciation. All depreciation was up to date as of December 31, 2021. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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:Current Attempt in Progress
Crane Company had the following assets on January 1, 2022.
Item
Machinery
Forklift
Truck
Cost
$59,000
18,000
24,400
Purchase Date
Jan 1, 2012
Jan 1, 2019
Jan. 1, 2017
Useful Life
(in years)
10
5
8
Salvage Value
$0
0
3,000
During 2022, each of the assets was removed from service. The machinery was retired on January 1. The forklift was sold on June 30
for $10,800. The truck was discarded on December 31.
Journalize all entries required on the above dates, including entries to update depreciation, where applicable, on disposed assets. The
company uses straight-line depreciation. All depreciation was up to date as of December 31, 2021. (Credit account titles are
automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and
enter o for the amounts.)
Transcribed Image Text:Date
1
Account Titles and Explanation
(To record depreciation expense on forklift)
ow Transcribed Text
(To record sale of forklift)
(To record depreciation expense on truck)
(To record sale of truck)
G
C
Debit
Credit
0000
1.11
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