Platero Co. purchases a used machine for $198,750 cash on January 2 and readies it for use
Question:
Required
1. Prepare journal entries to record the machine’s purchase and the costs to ready and install it. Cash is paid for all costs incurred.
2. Prepare journal entries to record depreciation of the machine at December 31 of.
(a) Its first year in operations.
(b) The year of its disposal.
3. Prepare journal entries to record the machine’s disposal under each of the following separate assumptions:
(a) It is sold for $21,000 cash.
(b) It is sold for $73,500 cash.
(c) It is destroyed in a fire and the insurance company pays $31,500 cash to settle the loss claim.
Salvage Value
Salvage value is the estimated book value of an asset after depreciation is complete, based on what a company expects to receive in exchange for the asset at the end of its useful life. As such, an asset’s estimated salvage value is an important...
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Related Book For
Question Posted: