Problem 10-2A Depreciation methods LO P1 A machine costing $209,400 with a four-year life and an estimated $19,000 salvage value is installed in Luther Company's factory on January 1. The factory manager estimates the machine will produce 476,000 units of product during its life. It actually produces the following units: 122,600 in 1st year, 124,000 in 2nd year, 120,600 in 3rd year, 118,800 in 4th year. The total number of units produced by the end of year 4 exceeds the original estimate-this difference was not predicted. (The machine must not be depreciated below its estimated salvage value.) Required: Compute depreciation for each year (and total depreciation of all years combined) for the machine under each depreciation method. (Round your per unit depreciation to 2 decimal places. Round your answers to the nearest whole dollar.) Complete this question by entering your answers in the tabs below. Units of Straight Line DDB Production Compute depreciation for each year (and total depreciation of all years combined) for the machine under each Units of production Units of Production Depreciable Units Depreciation per unit Depreciation Expense Year 1 2 3 4 Total Straight Line DDB Problem 10-2A Depreciation methods LO P1 A machine costing $209,400 with a four-year life and an estimated $19,000 salvage value is installed in Luther Company's factory on January 1. The factory manager estimates the machine will produce 476,000 units of product during its life. It actually produces the following units: 122,600 in 1st year, 124,000 in 2nd year, 120,600 in 3rd year, 118,800 in 4th year. The total number of units produced by the end of year 4 exceeds the original estimate--this difference was not predicted. (The machine must not be depreciated below its estimated salvage value.) Required: Compute depreciation for each year (and total depreciation of all years combined) for the machine under each depreciation method. (Round your per unit depreciation to 2 decimal places. Round your answers to the nearest whole dollar.) Complete this question by entering your answers in the tabs below. Units of Straight Line DDB Production Compute depreciation for each year (and total depreciation of all years combined) for the machine under each Double- declining-balance. DDB Depreciation for the Period End of Period Beginning of Period Book Accumulated Depreciation Depreciation Rate Depreciation Expense Year Book Value Value % 1 2 % 3 % % DDB > Units of Production Required information Problem 10-6A Disposal of plant assets LO C1, P1, P2 [The following information applies to the questions displayed below.] Onslow Co. purchases a used machine for $144,000 cash on January 2 and readies it for use the next day at a $10,000 cost. On January 3, it is installed on a required operating platform costing $2,000, and it is further readied for operations. The company predicts the machine will be used for six years and have a $17,280 salvage value. Depreciation is to be charged on a straight-line basis. On December 31, at the end of its fifth year in operations, it is disposed of Problem 10-6A Part 1 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 View transaction list Journal entry worksheet 1 2 3 Record the purchase of a used machine for $144,000 cash Note: Enter debits before credits. Date General Journal Debit Credit Jan 02 Record entry Clear entry View general jou rnal Required information Problem 10-6A Disposal of plant assets LO C1, P1, P2 [The following information applies to the questions displayed below.] Onslow Co. purchases a used machine for $144,000 cash on January 2 and readies it for use the next day at a $10,000 cost.On January 3, it is installed on a required operating platform costing $2,000, and it is further readied for operations The company predicts the machine will be used for six years and have a $17,280 salvage value. Depreciation is to be charged on a straight-line basis. On December 31, at the end of its fifth year in operations, it is disposed of. Problem 10-6A Part 1 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. View transaction list Journal entry worksheet 1 2 3 Record the costs of $10,000 incurred on the used machine. Note: Enter debits before credits. Date General Journal Debit Credit Jan 03 Record entry Clear entry View general journal Required information Problem 10-6A Disposal of plant assets LO C1, P1, P2 [The following information applies to the questions displayed below.] Onslow Co.purchases a used machine for $144,000 cash on January 2 and readies it for use the next day at a $10,000 cost. On January 3, it is installed on a required operating platform costing $2,000, and it is further readied for operations. The company predicts the machine will be used for six years and have a $17,280 salvage value. Depreciation is to be charged on a straight-line basis. On December 31, at the end of its fifth year in operations, it is disposed of. Problem 10-6A Part 1 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 View transaction list Journal entry worksheet 2 3 1 Record the cost of $2,000 for an operating platform. Note: Enter debits before credits. Date General Journal Debit Credit Jan 03 Record entry Clear entry View general journal ! Required information Problem 10-6A Disposal of plant assets LO C1, P1, P2 [The following information applies to the questions displayed below.] Onslow Co. purchases a used machine for $144,000 cash on January 2 and readies it for use the next day at a $10,000 cost. On January 3, it is installed on a required operating platform costing $2,000, and it is further readied for operations. The company predicts the machine will be used for six years and have a $17,280 salvage value. Depreciation is to be charged on a straight-line basis. On December 31, at the end of its fifth year in operations, it is disposed of. Problem 10-6A Part 2 2. Prepare journal entries to record depreciation of the machine at December 31. View transaction list Journal entry worksheet 2 1 Record the first year year-end adjusting entry for the depreciation expense of the used machine. Note: Enter debits before credits. Date Debit General Journal Credit Dec 31 View general journal Record entry Clear entry ! Required information Problem 10-6A Disposal of plant assets LO C1, P1, P2 [The following information applies to the questions displayed below.] Onslow Co. purchases a used machine for $144,000 cash on January 2 and readies it for use the next day at a $10,000 cost. On January 3, it is installed on a required operating platform costing $2,000, and it is further readied for operations. The company predicts the machine will be used for six years and have a $17,280 salvage value. Depreciation is to be charged on a straight-line basis. On December 31, at the end of its fifth year in operations, it is disposed of. Problem 10-6A Part 2 2. Prepare journal entries to record depreciation of the machine at December 31. View transaction list Journal entry worksheet 1 2 Record the year of disposal year-end adjusting entry for the depreciation expense of the used machine Note: Enter debits before credits. Date General Journal Debit Credit Dec 31 Record entry Clear entry View general journal Required information Problem 10-6A Disposal of plant assets LO C1, P1, P2 [The following information applies to the questions displayed below.] Onslow Co.purchases a used machine for $144,000 cash on January 2 and readies it for use the next day at a $10,000 cost. On January 3, it is installed on a required operating platform costing $2,000, and it is further readied for operations. The company predicts the machine will be used for six years and have a $17,280 salvage value. Depreciation is to be charged on a straight-line basis. On December 31, at the end of its fifth year in operations, it is disposed of. Problem 10-6A Part 3 3. Prepare journal entries to record the machine's disposal under each of the following separate assumptions: 1. Record the sale of the used machine for $20,500 cash 2. Record the sale of the used machine for $82,000 cash 3. Record the insurance settlement received of $31,000 resulting from the total destruction of the machine in a fire. View transaction list Journal entry worksheet 1 2 3 Record the sale of the used machine for $20,500 cash. Note: Enter debits before credits. Date General Journal Debit Credit Dec 31 Required information Problem 10-6A Disposal of plant assets LO C1, P1, P2 [The following information applies to the questions displayed below.] Onslow Co. purchases a used machine for $144,000 cash on January 2 and readies it for use the next day at a $10,000 cost. On January 3, it is installed on a required operating platform costing $2,000, and it is further readied for operations. The company predicts the machine will be used for six years and have a $17,280 salvage value. Depreciation is to be charged on a straight-line basis. On December 31, at the end of its fifth year in operations, it is disposed of. Problem 10-6A Part 3 3. Prepare journal entries to record the machine's disposal under each of the following separate assumptions: 1. Record the sale of the used machine for $20,500 cash. 2. Record the sale of the used machine for $82,000 cash. 3. Record the insurance settlement received of $31,000 resulting from the total destruction of the machine in a fire. View transaction list Journal entry worksheet