Recording Entries Using Composite Depreciation Method California Utilities owns a power plant that consists of the following assets, all acquired on January 1. Estimated Estimated Residual Value Life (Years) $18,000 30 10 6 Building Machinery Asset 171,000 Other equipment 90,000 a. Cost $540,000 Required a. Compute the total straight-line depreciation for the first year on all items combined. b. Compute the composite depreciation rate (based on cost) and the composite life. c. Provide the entry to record composite depreciation for the first year. d. Assume that all of the Other equipment was sold three years later for $10,800 cash. Prepare the entry for the sale of that equipment. Note: Round answers to the nearest whole dollar. Straight-Line Depreciation Expense Building Machinery b. C. Other Equipment Total depreciation expense for Year 1 $ Composite depreciation rate $ Composite life (in years) $ 0 9,000 Numerator Composite depreciation rate x $ 0x $ 0 0/$ 0/$ 0 0 Denominator 0= 0 = + = Year 1 Depreciation Exp. 0 = $ 0

Recording Entries Using Composite Depreciation Method California Utilities owns a power plant that consists of the following assets, all acquired on January 1. Estimated Estimated Residual Value Life (Years) $18,000 30 10 6 Building Machinery Asset 171,000 Other equipment 90,000 a. Cost $540,000 Required a. Compute the total straight-line depreciation for the first year on all items combined. b. Compute the composite depreciation rate (based on cost) and the composite life. c. Provide the entry to record composite depreciation for the first year. d. Assume that all of the Other equipment was sold three years later for $10,800 cash. Prepare the entry for the sale of that equipment. Note: Round answers to the nearest whole dollar. Straight-Line Depreciation Expense Building Machinery b. C. Other Equipment Total depreciation expense for Year 1 $ Composite depreciation rate $ Composite life (in years) $ 0 9,000 Numerator Composite depreciation rate x $ 0x $ 0 0/$ 0/$ 0 0 Denominator 0= 0 = + = Year 1 Depreciation Exp. 0 = $ 0

Name: Recording Entries Using Composite Depreciation MethodCalifornia Utili
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Description: Recording Entries Using Composite Depreciation MethodCalifornia Utilities owns a power plant that consists of the following assets, all acquired on January 1.BuildingMachineryAsset171,000Other equipment 90,000a.Cost$540,000Requireda. Compute the tot

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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