Chapter 9, Problem 9.9E

Straight-line Depreciation: Under the straight-line method of depreciation, the same amount of depreciation is allocated every year over the estimated useful life of an asset. The formula to calculate the depreciation cost of the asset using the salvage value is shown as below:

$\text{Depreciation cost = }\frac{\left(\text{Cost of the asset – Salvage value}\right)}{\text{Estimated useful life of the asset}}$

To determine

To record: the journal entry for the disposal of the equipment with no salvage value of Company R.

To determine

To record: the journal entry for the depreciation expense and disposal of plant assets.

To determine

To record: the journal entry for the depreciation expense for the equipment sold on December 31, 2015