On April 1, 20-3, Kwik Kopy Printing purchased a copy machine for $50,000. The estimated life of the machine is five years, and it has an estimated salvage value of $5,000. The machine was used until July 1, 20-6.Required:1.Assume that Kwik Kopy uses straight-line depreciation and prepare the following entries:(a)Adjusting entries for depreciation on December 31 of 20-3 through 20-5.(b)Adjusting entry for depreciation on June 30, 20-6, just prior to trading in the asset.(c)On July 1, 20-6, the copy machine was traded in for a new copy machine. The market value of the new machine is $38,000. Kwik Kopy must trade in the old copy machine and pay $22,000 for the new machine.2.Assume that Kwik Kopy uses sum-of-the-years’-digits depreciation and prepare the following entries:(a)Adjusting entries for depreciation on December 31, 20-3 through 20-5.(b)Adjusting entry for depreciation on June 30, 20-6, just prior to trading in the asset.(c)On July 1, 20-6, the copy machine was traded in for a new copy machine. The market value of the new machine is $38,000. Kwik Kopy must trade in the old copy machine and pay $22,000 for the new machine.

Name: On April 1, 20-3, Kwik Kopy Printing purchased a copy machine for $50,
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Description: On April 1, 20-3, Kwik Kopy Printing purchased a copy machine for $50,000. The estimated life of the machine is five years, and it has an estimated salvage value of $5,000. The machine was used until July 1, 20-6.Required:1.Assume that Kwik Kopy uses

1a. Record adjusting entries for depreciation on December 31 of 20-3 through 20-5 as shown below:

Answered: On April 1, 20-3, Kwik Kopy Printing…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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On April 1, 20-3, Kwik Kopy Printing purchased a copy machine for $50,000. The estimated life of the machine is five years, and it has an estimated salvage value of $5,000. The machine was used until July 1, 20-6.

Required:

1.	Assume that Kwik Kopy uses straight-line depreciation and prepare the following entries:
(a)	Adjusting entries for depreciation on December 31 of 20-3 through 20-5.
(b)	Adjusting entry for depreciation on June 30, 20-6, just prior to trading in the asset.
(c)	On July 1, 20-6, the copy machine was traded in for a new copy machine. The market value of the new machine is $38,000. Kwik Kopy must trade in the old copy machine and pay $22,000 for the new machine.
2.	Assume that Kwik Kopy uses sum-of-the-years’-digits depreciation and prepare the following entries:
(a)	Adjusting entries for depreciation on December 31, 20-3 through 20-5.
(b)	Adjusting entry for depreciation on June 30, 20-6, just prior to trading in the asset.
(c)	On July 1, 20-6, the copy machine was traded in for a new copy machine. The market value of the new machine is $38,000. Kwik Kopy must trade in the old copy machine and pay $22,000 for the new machine.

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