Equipment acquired on January 6 at a cost of $425,000 has an estimated useful life of 20
Question:
Equipment acquired on January 6 at a cost of $425,000 has an estimated useful life of 20 years and an estimated residual value of $35,000.
Question Content Area
a. What was the annual amount of depreciation for Years 1-3 using the straight-line method of depreciation?
Year | Depreciation Expense |
---|---|
Year 1 | fill in the blank 1 of 3$ |
Year 2 | fill in the blank 2 of 3$ |
Year 3 | fill in the blank 3 of 3$ |
b. What was the book value of the equipment on January 1 of Year 4?
fill in the blank 1 of 1$
Question Content Area
c. Assuming that the equipment was sold on January 3 of Year 4 for $360,000, journalize the entry to record the sale. If an amount box does not require an entry, leave it blank.
Date | Account | Debit | Credit |
---|---|---|---|
January 3 | Accounts PayableCashDepreciation Expense-EquipmentEquipmentGain on Sale of Equipment | - Select - | - Select - |
Accounts PayableAccounts Receivable Accumulated Depreciation-EquipmentDepreciation Expense-Equipment Gain on Sale of Equipment | - Select - | - Select - | |
Accounts Payable Depreciation Expense-EquipmentEquipmentGain on Sale of EquipmentLoss on Sale of Equipment | - Select - | - Select - | |
Accumulated Depreciation-EquipmentCashEquipmentGain on Sale of EquipmentLoss on Sale of Equipment | - Select - | - Select - |
Question Content Area
d. Assuming that the equipment was sold on January 3 of Year 4 for $370,000 instead of $360,000, journalize the entry to record the sale. If an amount box does not require an entry, leave it blank.
Date | Account | Debit | Credit |
---|---|---|---|
January 3 | Cash Depreciation Expense-EquipmentEquipmentGain on Sale of EquipmentLoss on Sale of Equipment | - Select - | - Select - |
Accounts Payable Accumulated Depreciation-EquipmentDepreciation Expense-EquipmentEquipmentLoss on Sale of Equipment | - Select - | - Select - | |
Accumulated Depreciation-EquipmentCashDepreciation Expense-EquipmentEquipmentLoss on Sale of Equipment | - Select - | - Select - | |
Accumulated Depreciation-EquipmentCashDepreciation Expense-Equipment Gain on Sale of EquipmentLoss on Sale of equipment | - Select - | - Select |
Accounting
ISBN: 978-1337899451
27th edition
Authors: Carl S. Warren, James M. Reeve, Jonathan Duchac