QUESTION 3 Far East Company bought a machinery on 1 March 2015 costing $30,000 with a residual value of $6,000. The estimated years of useful life is 8 years. On I January 2017, it revised the estimated years of useful life from the original 8 years to 6 years, total 4 years remaining and with no residual value left. On 1 January 2019, the company sold its machinery at $15,000. The machinery was depreciated on a straight-line basis, with depreciation for partial years rounded to the nearest month. The company's financial year ended was on 31 December. Required: (a) Compute the yearly depreciation expense for Years 2015 to 2018. (b) Calculate the gain or loss on the disposal of the machinery on I January 2019. (c) Prepare the Journal Entry for the sale of the machinery on I January 2019. (Explanation of Journal Entry is required.) (SHOW WORKINGS)

QUESTION 3 Far East Company bought a machinery on 1 March 2015 costing $30,000 with a residual value of $6,000. The estimated years of useful life is 8 years. On I January 2017, it revised the estimated years of useful life from the original 8 years to 6 years, total 4 years remaining and with no residual value left. On 1 January 2019, the company sold its machinery at $15,000. The machinery was depreciated on a straight-line basis, with depreciation for partial years rounded to the nearest month. The company's financial year ended was on 31 December. Required: (a) Compute the yearly depreciation expense for Years 2015 to 2018. (b) Calculate the gain or loss on the disposal of the machinery on I January 2019. (c) Prepare the Journal Entry for the sale of the machinery on I January 2019. (Explanation of Journal Entry is required.) (SHOW WORKINGS)

Name: QUESTION 3Far East Company bought a machinery on 1 March 2015 costing
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Description: QUESTION 3Far East Company bought a machinery on 1 March 2015 costing S30,000 with a residualvalue of $6,000. The estimated years of useful life is 8 years.On 1 January 2017, it revised the estimated years of useful life from the original 8 years to

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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