Finally, the accountant has started the PPE and Depreciation Schedule for the year ended September 30, 2023. At Island Solutions, the depreciation policy is to apply one month's ownership, one month's depreciation. Your team was provided with the following information. • Land and Building were acquired for $800 000 in a lump sum purchase. At the time of acquisition, the appraised values of the land and building were $90 000 and $810 000 respectively. • Equipment with an appraised value and residualvalue of $40 000 and $3 000 respectively was received by the company as a donation. • Machinery costing $182 900 inclusive of $600 installation expense and $14 900 normal repair and maintenance cost, and with a $6 000 estimatedsalvage value was sold on February 1, 2023. 2. Complete the PPE and Depreciation Schedule below by providing the values for [a]- [j]. Show all workings. Assets Land Building Date of Acquisition Oct 1, 2021 Oct 1, 2021 Equipment Oct 2, 2021 Machinery Oct 2, 2021 Cost [a] [b] [e] [h] Residual Depreciation Value Method $40 000 3 000 6 000 SLM 150% declining balance SYD Estimated Useful Life (years) [c] 10 8 Annual Depreciation Expense at September 30 2022 $13 600 [f] D 2023 [d] [8] [1

Finally, the accountant has started the PPE and Depreciation Schedule for the year ended September 30, 2023. At Island Solutions, the depreciation policy is to apply one month's ownership, one month's depreciation. Your team was provided with the following information. • Land and Building were acquired for $800 000 in a lump sum purchase. At the time of acquisition, the appraised values of the land and building were $90 000 and $810 000 respectively. • Equipment with an appraised value and residualvalue of $40 000 and $3 000 respectively was received by the company as a donation. • Machinery costing $182 900 inclusive of $600 installation expense and $14 900 normal repair and maintenance cost, and with a $6 000 estimatedsalvage value was sold on February 1, 2023. 2. Complete the PPE and Depreciation Schedule below by providing the values for [a]- [j]. Show all workings. Assets Land Building Date of Acquisition Oct 1, 2021 Oct 1, 2021 Equipment Oct 2, 2021 Machinery Oct 2, 2021 Cost [a] [b] [e] [h] Residual Depreciation Value Method $40 000 3 000 6 000 SLM 150% declining balance SYD Estimated Useful Life (years) [c] 10 8 Annual Depreciation Expense at September 30 2022 $13 600 [f] D 2023 [d] [8] [1

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Description: Finally, the accountant has started the PPE and Depreciation Schedule for the year ended September30, 2023. At Island Solutions, the depreciation policy is to apply one month's ownership, one month'sdepreciation. Your team was provided with the foll

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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Bob Co purchased a building for $50,000 and began depreciating assuming a salvage value of $5,000 and useful life of 20 years. After 5 years, it was determined that the salvage value would be $10,000, but the useful life would only be for an additional 10 years. Calculate the depreciation, assuming straight line, for Year 1 and Year 6 of the building, and prepare the necessary journals.
Whispering Company owns equipment that cost $100,000 when purchased on January 1, 2019. It has been depreciated using the straight-line method based on an estimated salvage value of $10,000 and an estimated useful life of 5 years. Depreciation expense adjustments are recognized annually. Instructions: Prepare Whispering Company's journal entries to record the sale of the equipment in these four independent situations. Update depreciation on assets disposed of at time of sale. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) (a) (b) (c) (d) (e) (f) (a) Sold for $59,000 on January 1, 2022. Sold for $59,000 on April 1, 2022. SR. Account Titles and Explanation (b) Sold for $21,000 on January 1, 2022. Sold for $21,000 on September 1, 2022. Repeat (a), assuming Whispering uses double-declining…
The Loban Company purchased four cars for $9,000 each, and expects that they would be sold in three years for $1,500 each. The company uses group depreciation on a straight-line basis. 1. Prepare journal entries to record the acquisition and the first year's depreciation. 2. If one of the cars is sold at the beginning of the second year for $7,000, what journal entry is required?
Please show all your work
Equipment acquired at a cost of $96,000 has an estimated residual value of $6,000 and an estimated useful life of 10 years. It was placed in service on May 1 of the current fiscal year, which ends on December 31. This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the questions below. Open spreadsheet a. Determine the depreciation for the current fiscal year and for the following fiscal year by the straight-line method. Round your answers to the nearest dollar. Depreciation Year 1 S Year 2 $ b. Determine the depreciation for the current fiscal year and for the following fiscal year by the double-declining-balance method. Do not round the double-declining balance rate. Round your answers to the nearest dollar. Depreciation Year 1 S Year 2 S
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A building is acquired on January 1, at a cost of $900,000 with an estimated useful life of 10 years and salvage value of $81,000. Compute depreciation expense for the first three years using the double-declining-balance method. (Round your answers to the nearest dollar.)
The Masters Corporation purchased a piece of machinery for $300,000. The expected useful life (EUL) of the machine is 10 years. Machinery of this type normally has a salvage value of approximately 17 percent of the purchase price (use $50,000 for salvage value in this case.) Using the accounting/finance functions in Excel, complete the depreciation worksheet in Exercise11.xls in the following steps: 1. Use the following three methods to compute the depreciation in columns B, C, and D: (1) double- declining balance, (2) straight-line, and (3) sum-of-the-years’ digits. Columns F, G, and H should show the book value of each method for the 10 periods (10 years). Formulas should be used in the empty cells so that a change in the cost, salvage value, or expected useful life of the machinery automatically updates the worksheet. 2. PDF page 1: Print cells A8:H20 into one page with proper format. 3. PDF page 2: Print cell formulas in Cells A15:H15. You may edit the cell…
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An asset was purchased for $70,000 and originally estimated to have a useful life of 10 years with a residual value of $3,800. After 2 years of straight-line depreciation, it was determined that the remaining useful life of the asset was only 2 years with a residual value of $1,520. a. Determine the amount of the annual depreciation for the first 2 years. $ b. Determine the book value at the end of Year 2. $ c. Determine the depreciation expense for each of the remaining years after revision.
Becker Office Service purchased a new computer system on January 1, Year 1, for $37,700. It is expected to have a five-year useful life and a $4,000 salvage value. Becker Office Service expects to use the computer system more extensively in the early years of its life. Required Calculate the depreciation expense for each of the five years, assuming the use of straight-line depreciation. Calculate the depreciation expense for each of the five years, assuming the use of double-declining-balance depreciation. Assume that Becker Office Service sold the computer system at the end of the fourth year for $20,000. Compute the amount of gain or loss using each depreciation method.
Before you begin this assignment, review the Tying It All Together feature in the chapter iHeartMedia , Inc. in their annual report for the year ending December 31, 2015, state that the plant assets reported on its balance sheet includes the following: Depreciation is computed using the straight-line method. Requirements 1. Suppose iHeartMedia, Inc. purchases a new advertising structure for $100,000 on August 1. The residual value of the structure is $4,000 and the useful life is 10 years. How would iHeartMedia record the depreciation expense on December 31 in the first year of use? What about the second year of use? 2. What would be the book value of the structure at the end of the first year? What would be the book value of the structure at the end of the second year? 3. What would be the impact on iHeartMedia, Inc. financial statements if they failed to record the adjusting entry related to the structure?