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The following data relate to the Machinery account of Marigold, Inc. at December 31, 2020 Original cost Year purchased Useful life Salvage value Depreciation method Accum depr through 2020" Cash A $47,840 2015 10 years $3,224 Sum-of-the-years-digits $32.448 Machinery Machine A) 13.520 B 13.520 Machinery $53.040 2016 15,000 hours $3,120 Activity $36.608 с $83.200 2017 15 years * "in the year an asset is purchased. Marigold, Inc. does not record any depreciation expense on the asset In the year an asset is retired or traded in Marigold, Inc. takes a full year's depreciation on the asset The following transactions occurred during 2021 $5.200 Straight-line $15,600 D $83,200 2019 (a) On May 5, Machine A was sold for $13.520 cash The company's bookkeeper recorded this retirement in the following manner in the cash receipts journal, 10 years $5,200 Double-declining balance $16,6407 b) On December 31, it was determined that Machine B had been used 2.500 hours during 2021 () On December 31. before computing depreciation expense on Machine C. the management of Marigold, Inc. decided the useful life remaining from January 1, 2021, was 10 years (d) On December 31, it was discovered that a machine purchased in 2020 had been expensed completely in that year. This machine cost $29.120 and has a useful life of 10 years and no salvage value. Management has decided to use the double-declining balance method for this machine, which can be referred to as "Machine E

The following data relate to the Machinery account of Marigold, Inc. at December 31, 2020 Original cost Year purchased Useful life Salvage value Depreciation method Accum depr through 2020" Cash A $47,840 2015 10 years $3,224 Sum-of-the-years-digits $32.448 Machinery Machine A) 13.520 B 13.520 Machinery $53.040 2016 15,000 hours $3,120 Activity $36.608 с $83.200 2017 15 years * "in the year an asset is purchased. Marigold, Inc. does not record any depreciation expense on the asset In the year an asset is retired or traded in Marigold, Inc. takes a full year's depreciation on the asset The following transactions occurred during 2021 $5.200 Straight-line $15,600 D $83,200 2019 (a) On May 5, Machine A was sold for $13.520 cash The company's bookkeeper recorded this retirement in the following manner in the cash receipts journal, 10 years $5,200 Double-declining balance $16,6407 b) On December 31, it was determined that Machine B had been used 2.500 hours during 2021 () On December 31. before computing depreciation expense on Machine C. the management of Marigold, Inc. decided the useful life remaining from January 1, 2021, was 10 years (d) On December 31, it was discovered that a machine purchased in 2020 had been expensed completely in that year. This machine cost $29.120 and has a useful life of 10 years and no salvage value. Management has decided to use the double-declining balance method for this machine, which can be referred to as "Machine E

FINANCIAL ACCOUNTING
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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Prepare the necessary correcting entries for the year 2021. Record the appropriate depreciation expense on the above mentioned machines. Of no entry is required, select "No entry for the account titles and enter O for the amounts. Round intermediate calculations to 3 decimal places, eg 4.589 and final answers to O decimal places, eg 45,892 Credit occount titles are automatically Indented when amount is entered. Do not indent manually) No. Account Titles and Explanation (b) (c) e (To record current depreciation) (To properly record the sale) (To correct the incorrect expensing of the asset in 2020) Debit Credit
Transcribed Image Text:Prepare the necessary correcting entries for the year 2021. Record the appropriate depreciation expense on the above mentioned machines. Of no entry is required, select "No entry for the account titles and enter O for the amounts. Round intermediate calculations to 3 decimal places, eg 4.589 and final answers to O decimal places, eg 45,892 Credit occount titles are automatically Indented when amount is entered. Do not indent manually) No. Account Titles and Explanation (b) (c) e (To record current depreciation) (To properly record the sale) (To correct the incorrect expensing of the asset in 2020) Debit Credit
The following data relate to the Machinery account of Marigold, Inc. at December 31, 2020 Original cost Year purchased Useful life. Salvage value Depreciation method Accum depe through 2020" Cash A Machinery Machine A) $47,840 2015 10 years $3,224 Sum-of-the-years-digits $32,448 13.520 B 13.520 Machinery $53,040 2016 15,000 hours $3,120 Activity $36.608 C $83.200 2017 A "in the year an asset is purchased. Marigold, Inc. does not record any depreciation expense on the asset In the year an asset is retired or traded in Marigold, Inc. takes a full year's depreciation on the asset The following transactions occurred during 2021 15 years $5.200 Straight-line $15,600 D $83,200 2019 (a) On May 5, Machine A was sold for $13.520 cash The company's bookkeeper recorded this retirement in the following manner in the cash receipts journal, 10 years $5,200 Double-declining balance $16,640 b) On December 31, it was determined that Machine B had been used 2.500 hours during 2021 () On December 31. before computing depreciation expense on Machine C. the management of Marigold, Inc. decided the useful life remaining from January 1, 2021, was 10 years (d) On December 31, it was discovered that a machine purchased in 2020 had been expensed completely in that year. This machine cost $29.120 and has a useful life of 10 years and no salvage value. Management has decided to use the double declining balance method for this machine, which can be referred to as "Machine E
Transcribed Image Text:The following data relate to the Machinery account of Marigold, Inc. at December 31, 2020 Original cost Year purchased Useful life. Salvage value Depreciation method Accum depe through 2020" Cash A Machinery Machine A) $47,840 2015 10 years $3,224 Sum-of-the-years-digits $32,448 13.520 B 13.520 Machinery $53,040 2016 15,000 hours $3,120 Activity $36.608 C $83.200 2017 A "in the year an asset is purchased. Marigold, Inc. does not record any depreciation expense on the asset In the year an asset is retired or traded in Marigold, Inc. takes a full year's depreciation on the asset The following transactions occurred during 2021 15 years $5.200 Straight-line $15,600 D $83,200 2019 (a) On May 5, Machine A was sold for $13.520 cash The company's bookkeeper recorded this retirement in the following manner in the cash receipts journal, 10 years $5,200 Double-declining balance $16,640 b) On December 31, it was determined that Machine B had been used 2.500 hours during 2021 () On December 31. before computing depreciation expense on Machine C. the management of Marigold, Inc. decided the useful life remaining from January 1, 2021, was 10 years (d) On December 31, it was discovered that a machine purchased in 2020 had been expensed completely in that year. This machine cost $29.120 and has a useful life of 10 years and no salvage value. Management has decided to use the double declining balance method for this machine, which can be referred to as "Machine E
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Section 179 Deduction and Modified Accelerated Cost Recovery System (MACRS) Depreciation
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