The university purchased a new oven at a cost of $110,000. On the date of purchase, the company estimates the ovens will have a residual value of $20,000. The university expects to use the ovens for four years or 9,000 total hours. Required: a) Prepare the an nual adjusting entry for depreciation (i.e., since it is the same for every year, prepare the entry only once). b) What is the accumulated depreciation after two years? c) What is book value (i.e., balance sheet value) after two years? Account Dr. Cr. a. b. C.
The university purchased a new oven at a cost of $110,000. On the date of purchase, the company estimates the ovens will have a residual value of $20,000. The university expects to use the ovens for four years or 9,000 total hours. Required: a) Prepare the an nual adjusting entry for depreciation (i.e., since it is the same for every year, prepare the entry only once). b) What is the accumulated depreciation after two years? c) What is book value (i.e., balance sheet value) after two years? Account Dr. Cr. a. b. C.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Problem #3:
The university purchased a new oven at a cost of $110,000. On the date of purchase, the company
estimates the ovens will have a residual value of $20,000. The university expects to use the ovens for
four years or 9,000 total hours.
Required:
a) Prepare the an nual adjusting entry for depreciation (i.e., since it is the same for every year,
prepare the entry only once).
b) What is the accumulated depreciation after two years?
c) What is book value (i.e., balance sheet value) after two years?
Аccount
Dr.
Cr.
a.
b.
с.
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