Equipment was acquired at the beginning of the year at a cost of $550,000. The equipment was depreciated using the straight-line method based on an estimated useful life of 9 years and an estimated residual value of $44,205. a. What was the depreciation for the first year? Round your answer to the nearest cent. b. Using the rounded amount from Part a in your computation, determine the gain or loss on the sale of the equipment, assuming it was sol at the end of year eight for $95,704. Round your answer to the nearest cent. Enter your answer as a positive amount. c. Journalize the entry to record the sale. If an amount box does not require an entry, leave it blank. Round your answers to the neares cent.

Equipment was acquired at the beginning of the year at a cost of $550,000. The equipment was depreciated using the straight-line method based on an estimated useful life of 9 years and an estimated residual value of $44,205. a. What was the depreciation for the first year? Round your answer to the nearest cent. b. Using the rounded amount from Part a in your computation, determine the gain or loss on the sale of the equipment, assuming it was sol at the end of year eight for $95,704. Round your answer to the nearest cent. Enter your answer as a positive amount. c. Journalize the entry to record the sale. If an amount box does not require an entry, leave it blank. Round your answers to the neares cent.

Name: Šale of EquipmentEquipment was acquired at the beginning of the year
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Description: Šale of EquipmentEquipment was acquired at the beginning of the year at a cost of $550,000. The equipment was depreciated using the straight-line methodbased on an estimated useful life of 9 years and an estimated residual value of $44,205.a. What w

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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2.
Sale of Equipment Equipment was acquired at the beginning of the year at a cost of $537,500. The equipment was depreciated using the straight-line method based on an estimated useful life of 9 years and an estimated residual value of $45,805. a. What was the depreciation for the first year? Round your answer to the nearest cent. b. Using the rounded amount from Part a in your computation, determine the gain or loss on the sale of the equipment, assuming it was sold at the end of year eight for $94,863. Round your answer to the nearest cent. Enter your answer as a positive amount. c. Journalize the entry to record the sale. If an amount box does not require an entry, leave it blank. Round your answers to the nearest cent.
Windsor Company acquired a plant asset at the beginning of Year 1. The asset has an estimated service life of 5 years. An employee has prepared depreciation schedules for this asset using three different methods to compare the results of using one method with the results of using other methods. You are to assume that the following schedules have been correctly prepared for this asset using (1) the straight-line method, (2) the sum-of-the-years'-digits method, and (3) the double-declining- balance method. Year 1 2 3 4 5 Total Straight-Line $12,420 12,420 12,420 12,420 12,420 $62,100 Sum-of-the- Years'-Digits Balance $20,700 16,560 12,420 8,280 4,140 Double-Declining- $62,100 $27,600 16,560 9,936 5,962 2,042 $62,100 What is the cost of the asset being depreciated? What amount, if any, was used in the depreciation calculations for the salvage value for this asset?
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