At the beginning of the year, Oakmont Company bought three used machines from American Manufacturing, Inc. The machines immediately were overhauled, were installed, and started operating. Because the machines were different, each was recorded separately in the accounts. I7T Machine A Machine B Machine C Amount paid for asset $19,900 $10,400 $10,100 Installation costs 450 800 500 Renovation costs prior to use Repairs after production began 250 600 900 520 1,200 780 By the end of the first year, each machine had been operating 4,000 hours. Required: 1. Compute the cost of each machine. 2. Prepare the journal entry to record depreciation expense at the end of year 1, assuming the following: Estimates Life 5 years 20,000 hours 10 years Residual Value $1,400 Machine Depreciation Method Straight-line Units-of-production Double-declining-balance A B 800 2,300

At the beginning of the year, Oakmont Company bought three used machines from American Manufacturing, Inc. The machines immediately were overhauled, were installed, and started operating. Because the machines were different, each was recorded separately in the accounts. I7T Machine A Machine B Machine C Amount paid for asset $19,900 $10,400 $10,100 Installation costs 450 800 500 Renovation costs prior to use Repairs after production began 250 600 900 520 1,200 780 By the end of the first year, each machine had been operating 4,000 hours. Required: 1. Compute the cost of each machine. 2. Prepare the journal entry to record depreciation expense at the end of year 1, assuming the following: Estimates Life 5 years 20,000 hours 10 years Residual Value $1,400 Machine Depreciation Method Straight-line Units-of-production Double-declining-balance A B 800 2,300

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 4PB: During the current year, Arkells Inc. made the following expenditures relating to plant machinery. ...

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