Alpha Corporation owns machinery that costs Tk 10,50,000 when purchased on March 1, 2014. Depreciation has been recorded 10% per year and its residual value has been detemined Tk 50,000. The useful life of the asset was initially determined 10 years but after 2 years it is observed that it can be used 3 years more. The machinery is sold on March 1, 2018, for Tk 1,25,000. The company used diminishing balance method for their depreciation. Prepare joumal entries to (1) update depreciation for 2018 and (ii) record the sale.
Alpha Corporation owns machinery that costs Tk 10,50,000 when purchased on March 1, 2014. Depreciation has been recorded 10% per year and its residual value has been detemined Tk 50,000. The useful life of the asset was initially determined 10 years but after 2 years it is observed that it can be used 3 years more. The machinery is sold on March 1, 2018, for Tk 1,25,000. The company used diminishing balance method for their depreciation. Prepare joumal entries to (1) update depreciation for 2018 and (ii) record the sale.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter11: Depreciation, Depletion, Impairment, And Disposal
Section: Chapter Questions
Problem 8MC: On July 1, 2018, Mundo Corporation purchased factory equipment for 50,000. Residual value was...
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