**Depreciation Schedule Using the Units of Production Method****Asset Details:**- **Historical Cost:** $270,000- **Estimated Useful Life:** 6 years- **Salvage Value:** $24,000- **Estimated Useful Hours:** 12,000 hours**Estimated Hours Per Year:**- 3,100 hours in 2019- 1,100 hours in 2020- 1,200 hours in 2021- 2,800 hours in 2022- 2,600 hours in 2023- 1,200 hours in 2024**Requirements:**1. **Depreciation Schedule:** - Complete the depreciation schedule using the units of production method. **Adventure Park, Corp. Depreciation Schedule - Units of Production** | **Year** | **Depreciation Expense** | **Accumulated Depreciation** | **Depreciable Cost** | |:----------:|:------------------------:|:----------------------------:|:---------------------:| | 12.31.19 | | | | | 12.31.20 | | | | | 12.31.21 | | | | | 12.31.22 | | | | | 12.31.23 | | | | | 12.31.24 | | | |2. **Recording Depreciation Expense for 2020:** - Prepare a general journal entry for recording the depreciation expense. **General Journal Entry:** | **Account** | **DR** | **CR** | |--------------------------|---------|---------| | | | | | | | |3. **Net Book Value Calculation (12.31.20):** - Calculate the net book value of the equipment on December 31, 2020. | **Description** | **Amount** | |-----------------------------------|--------------| | **Historical Cost** | | | **(Accumulated Depreciation)** | | | **Net Book Value at 12.31.20** | | This exercise demonstrates the

Historical cost Estimated useful life Salvage value Estimated useful hours 270,000 6 years $ 24,000 12,000 hours Estimated hours per year: 3,100 2019 1,100 2020 1,200 2021 2,800 2022 2,600 2023 1,200 2024 Required | Complete the depreciation schedule using the Units of Production Method. %24

Historical cost Estimated useful life Salvage value Estimated useful hours 270,000 6 years $ 24,000 12,000 hours Estimated hours per year: 3,100 2019 1,100 2020 1,200 2021 2,800 2022 2,600 2023 1,200 2024 Required | Complete the depreciation schedule using the Units of Production Method. %24

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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Problem 4 – Depreciation and Disposal On Jan. 1, 2020, Forsyth Co. acquired a unit of equipment for a total cost of P5,000,000. The entity estimates that during its 10-year useful life, the equipment will be able to produce 500,000 units of its product for 40,000 working hours, and will be sold for scrap. The usage of the equipment from 2020 to 2023 is as follows: Units Produced Hours Used 2020 32,000 2,500 2021 40,000 3,250 2022 45,000 4,200 2023 60,000 4,500 On Jan. 1, 2024, the equipment was sold for P3,250,000. 1. Using the units of output depreciation method: Determine the 2021 depreciation expense Determine the carrying value on December 31, 2022 Determine the gain or loss on disposal on January 1, 2024 а. b. с. 2. Using the working hours depreciation method: Determine the 2021 depreciation expense b. Determine the carrying value on December 31, 2022 Determine the gain or loss on disposal on January 1, 2024 а. с.
Font Paragraph Styles Dictate Sensitivity Editor 10 11 14 15 16 17 Part A: London Corp.Company purchased equipment in 2021 for $100,000 and estimated an $10,000 residual value at the end of the equipment's 10-year useful life. At December 31, 2027, there was $63,000 in the Accumulated Depreciation account for this equipment using the straight-line method of depreciation. On March 31, 2028, the equipment was sold for $28,500. Required Part A: a) Prepare the appropriate journal entries to update depreciation and then to remove the equipment from the books of Lui Company on March 31, 2028. Part B: Gagne Company sold a delivery truck for $14,000. The delivery truck originally cost $26,000 in 2021 and $4,000 was spent on a major overhaul in 2027 (charged to Delivery Truck account). Accumulated Depreciation on the delivery truck to the date of disposal was $16,000. Required Part B: Prepare the appropriate journal entry to record the disposition of the delivery truck. Part C: Campbellford…
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Knowledge Check 01 A company purchases a machine for $10,000. The estimated residual value is $4,000, and the estimated service life is 4 years or 10,000 units. The company uses the straight-line method of depreciation. The depreciable cost of the asset is: Multiple Choice O $1,000 $1,500 $6,000 $10,000
Problem 6-25 (Algo) Identify depreciation methods used LO 3 Grove Co. acquired a production machine on January 1, 2019, at a cost of $495,000. The machine is expected to have a four-year useful life, with a salvage value of $86,000. The machine is capable of producing 56,000 units of product in its lifetime. Actual production was as follows: 12,320 units in 2019; 17,920 units in 2020; 15,680 units in 2021; 10,080 units in 2022. Following is the comparative balance sheet presentation of the net book value of the production machine at December 31 for each year of the asset’s life, using three alternative depreciation methods (items a–c): Required: Identify the depreciation method used for each of the following comparative balance sheet presentations (items a–c). If a declining-balance method is used, be sure to indicate the percentage (150% or 200%). (Hint: Read the balance sheet from right to left to determine how much has been depreciated each year. Remember that December 31, 2019, is…
3 Question 2 of 2 E D (b) Your answer is partially correct. Date Apr. 1, 2026 Apr. 1, 2026 R On April 1, 2026, Blue sold the machine for $1,497,600 to Yoakam Company. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.) % V T Account Titles and Explanation G Depreciation Expense Accumulated Depreciation - Machinery (To record current depreciation.) Cash eTextbook and Media Accumulated Depreciation - Machinery Machinery Gain on Disposal of Machinery (To record sale of the machine.) B H HQ Search N U J M K L DELL LCOP { [ 1 ? 1 Debit 111 Enter Delete Shift Ctrl End 15/30 1 1 Attempts: 3 of 3 used 1 PgDn ||| ↓ Credit Home End 400 0 Ins
Exercise 6-13 (Algo) Depreciation calculation methods LO 3 Millco Inc., acquired a machine that cost $530,000 early in 2019. The machine is expected to last for tenth years, and its estimated salvage value at the end of its life is $73,000.Required:a. Using straight-line depreciation, calculate the depreciation expense to be recognized in the first year of the machine's life and calculate the accumulated depreciation after the fifth year of the machine's life. b. Using declining-balance depreciation at twice the straight-line rate, calculate the depreciation expense for the third year of the machine's life. c. What will be the net book value of the machine at the end of its tenth year of use before it is disposed of, under each depreciation method?
Problem 8-5: The Volga Corporation On January 1, 2021 the Volga Corporation purchased a new machine for $3240 cash. The machine has an estimated useful life of 3 years and a salvage value of $324. The following data are also available: Estimated Unit Output over Life of Equipment 30000 Unit Production in 2021 12000 Unit Production in 2022 6000 Unit Production in 2023 and following years 12000 Required: Prepare journal entries to record depreciation expense (rounding all amounts to the nearest $) for each December year end for the 3 year life of the machine using: 1. Straight Line Depreciation 2. Double Declining Balance Depreciation 3. Units of Production 4. Compute the net book value at the end of 2023 using straight line depreciation. 5. Compute the net book value at the end of 2023 using double declining balance depreciation. 6. Compute the net book value at the end of 2023 using units of production depreciation. Upon completion, enter the following data here: Deprec. Method 2021…