Ocean Fishers Ltd had a 22-foot fishing boat with an inboard motor that was purchased on April 9, 2009, for $ $77,000r The PPE Sub ledger shows the following information regarding the boat:

Fishing Boat – 22 Foot With Inboard Motor:

Component

Date of Purchase

Deprec. Method

Cost

Est. Residual

Est.Life

Fiberglass body

Apr. 9/09

SL

$

23800

$

7,000

15 yr

Motor

Apr. 9/09

SL

53200

-0-

10 yr

$

96,500

On June 27, 2017, $63,000 cash was paid for a new motor to replace the old one, which was scrapped The new motor had an estimated useful life of 12 years and a residual value of $4,200 Early in 2017, it was determined that the useful life of the boats fiberglass body should be adjusted to a total of 20 years with no change in the residual value

Record the appropriate entries regarding the

1a) Purchase of the replacement motor on June 27, 2017.

Entry 1- Record depreciation in 2017 regarding motor being replaced.

Entry 2- Record replacement of motor.

1b) Depreciation taken on the fishing boat (body plus motor) on December 31, 2017, the company’s year-end.

Entry 3- Record revised depreciation for 2017 on the boat (boat body plus motor.)

2. Calculate total depreciation taken on the fishing boat (body plus motor) for the company’s year ended December 31, 2017.

Answer rating: 100% (QA)

journal entries Requirement Date Account Debit Credit 1a June 27 2017 depreciation expense 43890 accumulated depreciation 43890 June 27 2017 new machi... View the full answer