EXERCISE 11-12 DISPOSAL OF PLANT ASSET Objective 7 A piece of equipment acquired on January 3, 1991, at a cost of $25,000, has an estima useful life of 4 years and an estimated residual value of $5,000. a. What was the annual amount of depreciation for the years 1991, 1992, and 1993, ushe the straight-line method of depreciation? b. What was the book value of the equipment on January 1, 1994? c. Assuming that the equipment was sold on January 2, 1994, for $8,500, joumaiza entry to record the sale. d. Assuming that the equipment had been sold for $11,500 on January 2, 1994, instead i $8,500, journalize the entry to record the sale. Go to Ser o

EXERCISE 11-12 DISPOSAL OF PLANT ASSET Objective 7 A piece of equipment acquired on January 3, 1991, at a cost of $25,000, has an estima useful life of 4 years and an estimated residual value of $5,000. a. What was the annual amount of depreciation for the years 1991, 1992, and 1993, ushe the straight-line method of depreciation? b. What was the book value of the equipment on January 1, 1994? c. Assuming that the equipment was sold on January 2, 1994, for $8,500, joumaiza entry to record the sale. d. Assuming that the equipment had been sold for $11,500 on January 2, 1994, instead i $8,500, journalize the entry to record the sale. Go to Ser o

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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406 Part Three Accounting S EXERCISE 11-11 ENTRIES FOR SALE OF PLANT ASSET A piece of equipment acquired on January 3, 1991, at a cost of $57,500, has an esti useful life of 5 years, an estimated residual value of $7,500, and is depreciated straight-line method. Objective 7 a. What was the book value of the equipment at December 31, 1994, the end of the fci year? b. Assuming that the equipment was sold on July 1, 1995, for $9,000, journalize the emác to record (1) depreciation for the six months of the 'curfent year ending December 1995, and (2) the sale of the equipment. WEXERCISE 11-12 DISPOSAL OF PLANT ASSET Objective 7 A piece of equipment acquired on January 3, 1991, at a cost of $25,000, has an estim useful life of 4 years and an estimated residual value of $5,000. a. What was the annual amount of depreciation for the years 1991, 1992, and 1993, usa the straight-line method of depreciation? b. What was the book value of the equipment on January 1, 1994? c. Assuming that the…
Question 3It is now March 31, 2008, and you are contemplating the disposal of an old piece of equipment. The equipment cost $36,000 and has accumulated depreciation of $20,000 at December 31 of the prior calendar year-end. The equipment is being depreciated over 10 years down to a residue of $6,000Record the sale of the equipment at March 31, 2008 assuming:a) The equipment is discardedb) The equipment is sold for $6,000, $10,000 or $20, 000.c) The equipment is exchanged for new, similar equipment having a cost of $42,000. Trade-in-Allowance for the old equipment is $18,000.Question 4On January 1, 20X2, The GenKota Winery purchased a new bottling system. The system has an expected life of 5 years. The system cost $325,000. Shipping, installation, and set up were an additional $35,000. At the end of the useful life, Julie Hayes, chief accountant for GenKota, expects to dispose of the bottling system for $26,000. She further anticipates total output of 668,000 bottles over the useful…
"PR 10-2AComparing three depreciation methodsOBJ. 2Dexter Industries purchased packaging equipment on January 8 for $72,000. The equip-ment was expected to have a useful life of three years, or 18,000 operating hours, and a residual value of $4,500. The equipment was used for 7,600 hours during Year 1, 6,000 hours in Year 2, and 4,400 hours in Year 3.Instructions1.Determine the amount of depreciation expense for the three years ending December 31 by (a) the straight-line method, (b) the units-of-activity method, and (c) the double-declining-balance method. Also determine the total depreciation expense for the three years by each method. The following columnar headings are suggested for recording the depreciation expense amounts:Depreciation ExpenseYearStraight- Line MethodUnits-of- Activity MethodDouble-Declining- Balance Method2.What method yields the highest depreciation expense for Year 1?3.What method yields the most depreciation over the three-year life of the equipment"
Question 15 of 17 Current Attempt in Progress Blue Spruce Corp. uses the straight-line method of depreciation. The company's fiscal year end is December 31. The following transactions occurred during 2022. Purchased equipment from the Kingbird, Inc. for $35,000 plus sales tax of 53.150 and shipping costs of $630. Jan. May 13 Incurred $392 routine maintenance on the equipment. Dec. 31 Recorded 2022 depreciation on the basis of a 3-year life and estimated salvage value of $13.580. Prepare the necessary entries. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit
Problem 7 – 18 Depreciation X Co. acquires a building on January 1, 200A at a cost of P5,500,000. The building has an estimated useful life of 40 years and an estimated salvage value of P500,000. Record the provision for depreciation for year 20OA.
MODULE 5 8-5 USE OF ASSET Please read the following question and provide the correct answer and explain how you came to that answer. Thank you! Nerdz, Inc. has just acquired a new truck for use in the business. Cost of the truck was $40,000. Nerdz has determined that the life of the truck will be three years and no salvage. Depreciation is straight-line a) Journalize the entry to record the depreciation for the first year of asset's life b) Journalize the entry to record the depreciation for the first month of teh asset's life.
EX 10-9 Depreciation by two methods OBJ.2 A computer system acquired on January 1 at a cost of $35,000 has an estimated useful life of five years. Assuming that it will have no residual value, determine the depreciation for each of the first two years (a) by the straight-line method and (b) by the double-declining. balance method.
Problem 9-03A Sunland Company had the following assets on January 1, 2022. Item Cost Purchase Date Useful Life(in years) Salvage Value Machinery $77,000 Jan. 1, 2012 10 $ 0 Forklift 36,000 Jan. 1, 2019 5 0 Truck 42,400 Jan. 1, 2017 8 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 $12,600. 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 0 for the amounts.) Date Account Titles and Explanation Debit Credit choose a transaction date…
Exercise 6-18A (Static) Asset replacement decision LO 6-5 Tesla management are trying to decide whether to keep an older piece of machinery or buy a replacement. Management was presented with the following information to assist in their decision: • The old machine was purchased three years ago for $720,000 and has a current book value using straight-line depreciation of $400,000. • The old machine incurs operating expenses of $60,000 per year. • The current disposal value of the old machine is $170,000; if it is kept nine more years, its remaining value would be $20,000. • The replacement machine would cost $480,000 and have a useful life of nine years. • The replacement machine has an expected salvage value of $130,000 after nine years. • The replacement machine would require $26,000 per year in operating expenses. Required Calculate the total costs in keeping the old machine and purchase a new machine. Should the old machine be replaced? Keep Old Purchase New Machine Machine Total…
Exercise 8-10A Double-declining-balance and units-of-production depreciation: gain or loss on disposal LO 8-3, 8-4 (The following information applies to the questions displayed below.) Exact Photo Service purchased a new color printer at the beginning of Year 1 for $35,350. The printer is expected to have a four-year useful life and a $3,800 salvage value. The expected print production is estimated at $1,773,800 pages. Actual print production for the four years was as follows: 554,300 484,000 377,200 387,300 Year 1 Year 2 Year 3 Year 4 Total 1,802,800 The printer was sold at the end of Year 4 for $4,050. Exercise 8-10A Part b b. Compute the depreciation expense for each of the four years, using units-of-production depreciation. (Round cost per unit to three decimal places and final answers to the nearest whole dollar amount.) Depreciation Expense Year 1 Year 2 Year 3 Year 4 24 Total accumulated depreciation
Problem 1 A schedule of machinery owned by Trust Company is presented below: Machine A Machine B Machine C Total Cost 2,500,000.00 1,200,000.00 380,000.00 Estimated Salvage Estimated life in Value years 566,665.00 320,000.00 18.00 10.00 4.00 Trust Company computes depreciation on the straight line method. Required: Based upon the information presented, 1) what is the composite life of these assets? 2) what is the composite rate?