Metals Inc. acquired metal recycling equipment acquired on January 3, 2003, at a cost of $240,000, with
Question:
a. What was the book value of the equipment at December 31, 2006, the end of the fiscal year?
b. Assuming that the equipment was sold on July 1, 2007, for $135,000, journalize the entries to record
(1) Depreciation for the six months until the sale date and
(2) The sale of the equipment.
Step by Step Answer:
a Cost of equipment 240000 Accumulated depreciation at December 31 2006 4 yea...View the full answer
Financial Accounting An Integrated Statements Approach
ISBN: 978-0324312119
2nd Edition
Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren
Related Video
In accounting terms, depreciation is defined as the reduction of the recorded cost of a fixed asset in a systematic manner until the value of the asset becomes zero or negligible. An example of fixed assets are buildings, furniture, office equipment, machinery, etc. The land is the only exception that cannot be depreciated as the value of land appreciates with time. Depreciation allows a portion of the cost of a fixed asset to be the revenue generated by the fixed asset. This is mandatory under the matching principle as revenues are recorded with their associated expenses in the accounting period when the asset is in use. This helps in getting a complete picture of the revenue
Students also viewed these Accounting questions
-
Equipment acquired on January 3, 2012, at a cost of $380,000, has an estimated useful life of 16 years, an estimated residual value of $40,000, and is depreciated by the straight line method. a. What...
-
An intangible asset with an estimated useful life of 30 years was acquired on January 1, 2002, for $540,000. On January 1, 2012, a review was made of intangible assets and their expected service...
-
Equipment acquired on January 8 at a cost of $168,000 has an estimated useful life of 18 years, has an estimated residual value of $15,000, and is depreciated by the straight line method. a. What was...
-
Let a 0. Solve |x| = 3.
-
During 2016, El Dorado Inc. has monthly cash expenses of $168,500. On December 31, 2016, the cash balance is $1,415,400. a. Compute the ratio of cash to monthly cash expenses. b. Based on (a), what...
-
Determine the horizontal and vertical components of reaction at A and the tension in cable BC on the boom in Prob. 56.
-
Prove that the matrices $\mathbf{H}$ and $\mathbf{I}-\mathbf{H}$ are idempotent, that is, $\mathbf{H H}=\mathbf{H}$ and $(\mathbf{I}-\mathbf{H})(\mathbf{I}-\mathbf{H})=\mathbf{I}-\mathbf{H}$.
-
The Fun Foods Corporation must decide on what new product lines to introduce next year. After-tax cash flows are listed below along with initial investments. The firm's cost of capital is 12 percent...
-
PROBLEM 2-25 Calculating Ending Inventories and Cost of Goods Sold LO2-5 Expedition Company worked on five jobs during May: Jobs A10, B20, C30, D40, and E50. At the end of May, the job cost sheets...
-
Katey is a California CPA practicing in California. Katey has been licensed in California for 20 years, all of those years in active status. She is a partner in the firm of Perry & Sherry, CPA's....
-
The following data were taken from recent annual reports of Interstate Bakeries Corporation (IBC). Interstate Bakeries produces, distributes, and sells fresh bakery products nationwide through...
-
Equipment acquired on January 3, 2004, at a cost of $96,000, has an estimated useful life of six years and an estimated residual value of $6,000. a. What was the annual amount of depreciation for the...
-
A cylinder is fitted with a 10-cm-diameter piston that is restrained by a linear spring (force proportional to distance) as shown in Fig. P3.113. The spring force constant is 80 kN/m and the piston...
-
Explain Jonathan Edwards "new Light theology"
-
A survey of a local market has provided the following average cost data: Johnson Construction Corporation (JCC) has assets of $3 million and an average cost of 19 percent. Anderson Architects (AA)...
-
http://www.ted.com/talks/richard_wilkinson Watch the following video of Richard Wilkinson How economic inequality harms societies from Ted Talks. Post a brief analysis of the lecture.
-
What cultures are against having a strong work ethic environment like Japan & china. Cultures that view hard working diligence 24/7 as a "necessary evil?
-
February 26 The company paid cash to Lyn Addie for eight days' work at $120 per day. March 25 The company sold merchandise with a $2,400 cost for $3,200 on credit to Wildcat Services, invoice dated...
-
A(n) ____________ defect occurs when a defendant chooses materials that result in the product having a structural weakness that makes it dangerous.
-
When the Department of Homeland Security created a color-coded system to prepare government officials and the public against terrorist attacks, what did it do right and what did it do wrong?
-
What is the meaning and importance of a program champion?
-
(a) During October, $90,000 was paid to creditors on account, and purchases on account where $125,000. Assuming the October 31 balance of Accounts Payable was $40,000 determine the accounts balance...
-
As of January 1, retained earnings had a credit balance of $125,000. During the year, dividends totaled $7,000, and the business incurred a net loss of $130,000. (a) Compute the balance of retained...
-
Southwest Tours Co. is travel agency. The nine transactions recorded by Southwest Tours during May 2012, its first month of operations, are indicated in the following T accounts: Indicate for each...
-
Describe, in steps, at least one strategy used to attack embedded operating systems. Describe, in steps, at least one strategy used to defend against the chosen attack.
-
how does a hypercompetetice environment challenge those in an industry
-
Describe how managers can reduce unnecessary costs, including real - world examples of how it has been done
Study smarter with the SolutionInn App