Shipping costs (paid by 500 Plummer) 1,000 500 Renovation costs prior to use 2,500 1,000 1,500 By the end of the first year, each machine had been operating 4,800 hours. Prepare the entry to record depreciation expense at the end of Year 1, assuming the fo ote: Do not round intermediate calculations. If no entry is required for a transaction/e quired" in the first account field. ESTIMATES Residual achine Life Value Depreciation Method A 5 years $1,000 Straight-line 60,000 Units-of- B 2,000 hours production ப C 4 years 1,500 Double-declining-

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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Required information
[The following information applies to the questions displayed below.]
At the beginning of the year, Plummer's Sports Center bought three used fitness machines from Primo
Fitness, an established supplier of used, new and refurbished gym equipment in Southern California. The
machines immediately were overhauled and started operating. The machines were different; therefore, each
had to be recorded separately in the accounts.
Machine Machine Machine
Invoice price paid for
asset
Shipping costs (paid by
Plummer)
A
B
C
$11,000 $30,000 $8,000
500 1,000
500
Renovation costs prior
to use
2,500
1,000 1,500
By the end of the first year, each machine had been operating 4,800 hours.
2. Prepare the entry to record depreciation expense at the end of Year 1, assuming the following.
Note: Do not round intermediate calculations. If no entry is required for a transaction/event, select "No journal entry
required" in the first account field.
ESTIMATES
Residual
Machine
Life
Value
Depreciation
Method
A
5 years
$1,000
Straight-line
60,000
Units-of-
B
2,000
hours
production
с
4 years
1,500
Double-declining-
balance
View transaction list
Journal entry worksheet
<
1
Record the depreciation expense for year 1.
Note: Enter debits before credits.
Transaction
a
General Journal
Debit Credit
Record entry
View general journal
Clear entry
>
Transcribed Image Text:Required information [The following information applies to the questions displayed below.] At the beginning of the year, Plummer's Sports Center bought three used fitness machines from Primo Fitness, an established supplier of used, new and refurbished gym equipment in Southern California. The machines immediately were overhauled and started operating. The machines were different; therefore, each had to be recorded separately in the accounts. Machine Machine Machine Invoice price paid for asset Shipping costs (paid by Plummer) A B C $11,000 $30,000 $8,000 500 1,000 500 Renovation costs prior to use 2,500 1,000 1,500 By the end of the first year, each machine had been operating 4,800 hours. 2. Prepare the entry to record depreciation expense at the end of Year 1, assuming the following. Note: Do not round intermediate calculations. If no entry is required for a transaction/event, select "No journal entry required" in the first account field. ESTIMATES Residual Machine Life Value Depreciation Method A 5 years $1,000 Straight-line 60,000 Units-of- B 2,000 hours production с 4 years 1,500 Double-declining- balance View transaction list Journal entry worksheet < 1 Record the depreciation expense for year 1. Note: Enter debits before credits. Transaction a General Journal Debit Credit Record entry View general journal Clear entry >
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