Entries for Sale of Fixed Asset Equipment acquired on January 8 at a cost of $155,500 has an estimated useful life of 19 years, has an estimated residual value of $9,200, and is depreciated by the straight-line method. a. What was the book value of the equipment at December 31 the end of the fourth year? b. Assume that the equipment was sold on April 1 of the fifth year for $116,610. 1. Journalize the entry to record depreciation for the three months until the sale date. If an amount box does not require an entry, leave it blank. Round your answers to the nearest whole dollar if required. 2. Journalize the entry to record the sale of the equipment. If an amount box does not require an entry, leave it blank. Do not round intermediate calculations.
Entries for Sale of Fixed Asset Equipment acquired on January 8 at a cost of $155,500 has an estimated useful life of 19 years, has an estimated residual value of $9,200, and is depreciated by the straight-line method. a. What was the book value of the equipment at December 31 the end of the fourth year? b. Assume that the equipment was sold on April 1 of the fifth year for $116,610. 1. Journalize the entry to record depreciation for the three months until the sale date. If an amount box does not require an entry, leave it blank. Round your answers to the nearest whole dollar if required. 2. Journalize the entry to record the sale of the equipment. If an amount box does not require an entry, leave it blank. Do not round intermediate calculations.
Financial Accounting: The Impact on Decision Makers
10th Edition
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Gary A. Porter, Curtis L. Norton
Chapter8: Operating Assets: Property, Plant, And Equipment, And Intangibles
Section: Chapter Questions
Problem 8.6E
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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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![Entries for Sale of Fixed Asset
Equipment acquired on January 8 at a cost of $155,500 has an estimated useful life of 19 years, has an estimated residual value of $9,200, and is depreciated by the
straight-line method.
a. What was the book value of the equipment at December 31 the end of the fourth year?
b. Assume that the equipment was sold on April 1 of the fifth year for $116,610.
1. Journalize the entry to record depreciation for the three months until the sale date. If an amount box does not require an entry, leave it blank. Round your
answers to the nearest whole dollar if required.
2. Journalize the entry to record the sale of the equipment. If an amount box does not require an entry, leave it blank. Do not round intermediate calculations.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F58f64e99-b3fb-491d-a9f5-7a66a1bd819c%2F4e190634-fb68-4272-8e23-80ded2e625c6%2Fwhq7ni3_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Entries for Sale of Fixed Asset
Equipment acquired on January 8 at a cost of $155,500 has an estimated useful life of 19 years, has an estimated residual value of $9,200, and is depreciated by the
straight-line method.
a. What was the book value of the equipment at December 31 the end of the fourth year?
b. Assume that the equipment was sold on April 1 of the fifth year for $116,610.
1. Journalize the entry to record depreciation for the three months until the sale date. If an amount box does not require an entry, leave it blank. Round your
answers to the nearest whole dollar if required.
2. Journalize the entry to record the sale of the equipment. If an amount box does not require an entry, leave it blank. Do not round intermediate calculations.
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