Here are selected 2022 transactions of Sarasota Corporation. Jan. 1 June 30 Dec. 31 Retired a piece of machinery that was purchased on January 1, 2012. The machine cost $61,500 and had a useful life of 10 years with no salvage value. Sold a computer that was purchased on January 1, 2020. The computer cost $36,400 and had a useful life of 4 years with no salvage value. The computer was sold for $4,100 cash. Sold a delivery truck for $9,300 cash. The truck cost $24,600 when it was purchased on January 1, 2019, and was depreciated based on a 5-year useful life with a $3,700 salvage value. Prepare a tabular summary to record all transactions described on the above dates. Depreciation was last recorded on December 31, 2021. Update depreciation on assets disposed of where applicablo Carta
Here are selected 2022 transactions of Sarasota Corporation. Jan. 1 June 30 Dec. 31 Retired a piece of machinery that was purchased on January 1, 2012. The machine cost $61,500 and had a useful life of 10 years with no salvage value. Sold a computer that was purchased on January 1, 2020. The computer cost $36,400 and had a useful life of 4 years with no salvage value. The computer was sold for $4,100 cash. Sold a delivery truck for $9,300 cash. The truck cost $24,600 when it was purchased on January 1, 2019, and was depreciated based on a 5-year useful life with a $3,700 salvage value. Prepare a tabular summary to record all transactions described on the above dates. Depreciation was last recorded on December 31, 2021. Update depreciation on assets disposed of where applicablo Carta
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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.
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Transcribed Image Text:Here are selected 2022 transactions of Sarasota Corporation.
Jan. 1
June
30
Dec.
31
Jan. 1
Retired a piece of machinery that was purchased on January 1, 2012. The machine cost $61,500 and had a useful life
of 10 years with no salvage value.
June 30
Sold a computer that was purchased on January 1, 2020. The computer cost $36,400 and had a useful life of 4 years with
no salvage value. The computer was sold for $4,100 cash.
Prepare a tabular summary to record all transactions described on the above dates. Depreciation was last recorded on December 31,
2021. Update depreciation on assets disposed of, where applicable. Sarasota Corporation uses straight-line depreciation. (If a
transaction causes a decrease in Assets, Liabilities or Stockholders' Equity, place a negative sign (or parentheses) in front of the amount entered
for the particular Asset, Liability or Equity item that was reduced.)
Sold a delivery truck for $9,300 cash. The truck cost $24,600 when it was purchased on January 1, 2019, and was
depreciated based on a 5-year useful life with a $3,700 salvage value.
Cash
+
Assets
Equipment
Accum. Depr. - Equip.
= Liabilities
+
$
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