From the given data, determine the CONSOLIDATED EQUIPMENT on December 31, 20x7. On January 1, 20x7 Mamba sold the equipment for 110,000 when its book value was 85,000 and it had a 5-year remaining useful life with no expected salvage. Separate balance sheets for Mamba and King included the following equipment and accumulated depreciation amounts on December 31, 20x7. Mamba King Equipment 750,000 300,000 Accumulated Depreciation (250,000 (50,000) Equipment-Net 500,000 250,000
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.
From the given data, determine the CONSOLIDATED EQUIPMENT on December 31, 20x7. On January 1, 20x7 Mamba sold the equipment for 110,000 when its book value was 85,000 and it had a 5-year remaining useful life with no expected salvage. Separate
| Mamba | King | |
| Equipment | 750,000 | 300,000 |
| Accumulated Depreciation | (250,000 | (50,000) |
| Equipment-Net | 500,000 | 250,000 |
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