The following information was provided relating to an asset:Acquisition date: 1 January 20X1Acquisition cost: $76,000Residual value: $6,000Estimated useful life: 5 yearsService hours: 35,000Productive output in units: 7,000Actual Data: ServiceHoursUnitsProduced20X14,70040020X26,9001,10020X37,2001,60020X47,6001,80020X58,6002,100 35,0007,000 Required:Prepare the journal entries to record depreciation expense for each year of the asset’s life, using the double declining balance method. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Assets are depreciated using this method at twice the rate of straight-line depreciation. The amount…

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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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The following information was provided relating to an asset:

Acquisition date: 1 January 20X1
Acquisition cost: $76,000
Residual value: $6,000
Estimated useful life: 5 years
Service hours: 35,000
Productive output in units: 7,000

Actual Data:

	Service Hours	Units Produced
20X1	4,700	400
20X2	6,900	1,100
20X3	7,200	1,600
20X4	7,600	1,800
20X5	8,600	2,100
	35,000	7,000

Required:

Prepare the journal entries to record depreciation expense for each year of the asset’s life, using the double declining balance method. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

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