For financial reporting, Kumas Poultry Farms has used the declining-balance method of depreciation for conveyer.equipment acquired at the beginning of 2021 for $2,560,000. Its useful life was estimated to be six years with a $160,000residual value. At the beginning of 2024, Kumas decides to change to the straight-line method. The effect of this change ondepreciation for each year is as follows:Year202120222023Straight-Line$ 400400400$ 1,200View transaction list($ in thousands)Declining Balance$ 853569379$ 1,801Required:2. Prepare any 2024 journal entry related to the change.Note: Enter you answers rounded to the nearest dollar. If no entry is required for a transaction/event, select "No journalentry required" in the first account field.Journal entry worksheet1Difference.$ 453169(21)$ 601Record the adjusting entry for depreciation in 2024.Note: Enter debits before credits.< Prev 3 of 7www***Next >

A journal entry is a basic accounting record that is used to chronologically track financial…

Answered: For financial reporting, Kumas Poultry…

For financial reporting, Kumas Poultry Farms has equipment acquired at the beginning of 2021 for residual value. At the beginning of 2024, Kumas depreciation for each year is as follows:

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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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…
On April 1, 2024, Titan Corporation purchases office equipment for $50,000. For tax reporting, the company uses MACRS and classifies the equipment as 5-year personal property. In 2024, this type of equipment is eligible for 60% first-year bonus depreciation. For financial reporting, the company uses straight-line depreciation. Assume the equipment has no residual value.Required: Calculate annual depreciation for the five-year life of the equipment according to MACRS. The company uses the half-year convention for tax reporting purposes.Calculate annual depreciation for the five-year life of the equipment according to straight-line depreciation. The company uses partial-year depreciation based on the number of months the asset is in service for financial reporting purposes. In which year(s) is tax depreciation greater than financial reporting depreciation?
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For financial reporting, Kumas Poultry Farms has used the declining-balance method of depreciation for conveyor equipment acquired at the beginning of 2021 for $2,832,000. Its useful life was estimated to be six years with a $228,000 residual value. At the beginning of 2024, Kumas decides to change to the straight-line method. The effect of this change on depreciation for each year is as follows: Year ($ in thousands) Straight-Line Declining Balance Difference 2021 $ 434 $ 944 $ 510 2022 434 629 195 2023 434 420 (14) $ 1,302 $ 1,993 $ 691 Required: 2. Prepare any 2024 journal entry related to the change. Note: Enter you answers rounded to the nearest dollar. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
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