RR Consider the following independent situations.Situation 1: Ducharme Corporation purchased electrical equipment at a cost of $62,000on June 2, 2017. From 2017 through 2020, the equipment was depreciated on astraight-line basis, under the assumption that it would have a 10-year useful life and a$12,000 residual value. After more experience and before recording 2021'sdepreciation, Ducharme revised its estimate of the machine's useful life downward froma total of 10 years to 8 years, and revised the estimated residual value to $10,000. OnApril 29, 2022, after recording part of a year's depreciation for 2022, the companytraded in the equipment on a newer model, and received a $20,000 trade-in allowance,even though the equipment's fair value was only $14,000. The new asset had a list priceof $76,500 and the supplier accepted $56,500 cash for the balance. The new equipmentwas depreciated on a straight-line basis, assuming a seven-year useful life and a$6,500 residual value.Required #1:1. Journal Entry on June 02, 2017.2. Adjusting Entry on December 31, 2017.3. Adjusting Entry on December 31, 2018.4. Adjusting Entry on December 31, 2021.5. Journal Entry on April 29, 2022.6. Adjusting Entry on December 31, 2021.

Answered: 1. Journal Entry on June 02, 2017. 2 A

Business

Accounting

1. Journal Entry on June 02, 2017. 2 A

Individual Income Taxes

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ISBN:9780357109731

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Chapter18: Accounting Periods And Methods

Section: Chapter Questions

Problem 66P: At the end of 2020, Magenta Manufacturing Company discovered that construction cost had been...

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Question

Consider the following independent situations.
Situation 1: Ducharme Corporation purchased electrical equipment at a cost of $62,000
on June 2, 2017. From 2017 through 2020, the equipment was depreciated on a
straight-line basis, under the assumption that it would have a 10-year useful life and a
$12,000 residual value. After more experience and before recording 2021's
depreciation, Ducharme revised its estimate of the machine's useful life downward from
a total of 10 years to 8 years, and revised the estimated residual value to $10,000. On
April 29, 2022, after recording part of a year's depreciation for 2022, the company
traded in the equipment on a newer model, and received a $20,000 trade-in allowance,
even though the equipment's fair value was only $14,000. The new asset had a list price
of $76,500 and the supplier accepted $56,500 cash for the balance. The new equipment
was depreciated on a straight-line basis, assuming a seven-year useful life and a
$6,500 residual value.
Required #1:
1. Journal Entry on June 02, 2017.
2. Adjusting Entry on December 31, 2017.
3. Adjusting Entry on December 31, 2018.
4. Adjusting Entry on December 31, 2021.
5. Journal Entry on April 29, 2022.
6. Adjusting Entry on December 31, 2021.

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