can you please help with the highlighted question Disposal of Capital Assets Practice Exercises(a) Lui Company purchased equipment in 2009 for $80,000 and estimated an $8,000 residual value atthe end of the equipment's 10-year useful life. At December 31, 2015, there was $50,400 in theAccumulated Amortization account for this equipment using the straight-line method of amortization. OnMarch 31, 2016, the equipment was sold for $21,000.Prepare the appropriate journal entries to remove the equipment from the books of LuiCompany on March 31, 2016.

Cost of Equipment = $80000 Residual Value = $8000 Useful Life = 10 Years Annual Depreciation…

Answered: Prepare the appropriate journal entries…

Business

Accounting

Prepare the appropriate journal entries to remove the equipment from the books of Lui Company on March 31, 2016.

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

Chapter10: Long-lived Tangible And Intangible Assets

Section: Chapter Questions

Problem 19E

See similar textbooks

Similar questions

Comprehensive: Acquisition, Subsequent Expenditures, and Depreciation On January 2, 2019, Lapar Corporation purchased a machine for 50,000. Lapar paid shipping expenses of 500, as well as installation costs of 1,200. The company estimated that the machine would have a useful life of 10 years and a residual value of 3,000. On January 1, 2020, Lapar made additions costing 3,600 to the machine in order to comply with pollution-control ordinances. These additions neither prolonged the life of the machine nor increased the residual value. Required: 1. If Lapar records depreciation expense under the straight-line method, how much is the depreciation expense for 2020? 2. Assume Lapar determines the machine has three significant components as shown below. If Lapar uses IFRS, what is the amount of depreciation expense that would be recorded?
The following intangible assets were purchased by Hanna Unlimited: A. A patent with a remaining legal life of twelve years is bought, and Hanna expects to be able to use it for six years. It is purchased at a cost of $48,000. B. A copyright with a remaining life of thirty years is purchased, and Hanna expects to be able to use it for ten years. It is purchased for $70,000. Determine the annual amortization amount for each intangible asset.
Change in Estimate Assume that Bloomer Company purchased a new machine on January 1, 2016, for $80,000. The machine has an estimated useful life of nine years and a residual value of $8,000. Bloomer has chosen to use the straight-line method of depreciation. On January 1, 2018, Bloomer discovered that the machine would not be useful beyond December 31, 2021, and estimated its value at that time to be $2,000. Required Calculate the depreciation expense, accumulated depreciation, and book value of the asset for each year 2016 to 2021. Was the depreciation recorded wrong in 2016 and 2017? If so, why was it not corrected?
Expenditures After Acquisition Roanoke Manufacturing placed a robotic arm on a large assembly machine on January 1, 2019. At that time, the assembly machine was expected to last another 3 years. The following information is available concerning the assembly machine. The robotic arm cost $225,000 and was expected to extend the useful life of the machine by 3 years. Therefore, the useful life of the assembly machine, after the arm replacement, is 6 years. The assembly machine is expected to have a residual value of $120,000 at the end of its useful life. Required: 1. Prepare the journal entry necessary to record the addition of the robotic arm. 2. Compute 2019 depreciation expense for the machine using the straight-line method, and prepare the necessary journal entry. 3. What is the book value of the machine at the end of 2019? 4. CONCEPTUAL CONNECTION What would have been the effect on the financial statements if Roanoke had expensed the addition of the robotic arm?
Revision of Depreciation On January 1, 2017, Blizzards-R-Us purchased a snow-blowing machine for $125,000. The machine was expected to have a residual value of $12,000 at the end of its 5-year useful life. On January 1, 2019, Blizzards-R-Us concluded that the machine would have a remaining useful life of 6 years with a residual value of $3,600. Required: 1. Determine the revised annual depreciation expense for 2019 using the straight-line method. 2. CONCEPTUAL CONNECTION How does the revision in depreciation affect the Blizzards-R-Us financial statements?
E. DISPOSAL OF FIXED ASSETS Percy Company owns equipment that cost $74,000 when purchased on January 1, 2014. It has been depreciated using the straight-line method based on an estimated salvage value of $4,000 and an estimated useful life of 5 years. Instructions: Prepare Percy Company's journal entries to record the sale of the equipment for $31,000 on May 1, 2017. (3%)
Determining Carrying Value and Amortization of Intangible Assets Review the following information pertaining to Denzel Company. A patent was purchased on January 2, 2018, for $149,500 when the remaining legal life was 16 years. On January 2, 2020, Denzel determined that the remaining useful life of the patent was only eight years from the date of its acquisition. On January 1, 2020, Denzel Company purchased a second patent for $184,000 cash. At January 1, 2020, 6 years of the patent's legal life of 20 years had already expired. On June 30, 2020, Denzel Company paid a firm $18,400 for a new trademark. Denzel considers the life of the trademark to be indefinite. On November 1, 2020, Denzel Company acquired all noncash assets and assumed all liabilities of Lee Company at a cash purchase price of $276,000. Denzel determined that the fair value of the identfiable net assets acquired in the transaction is $269,100. Note: When answering the following questions, do not round until your…
Depreciation Methods On January 2, 2018, Skyler, Inc. purchased a laser cutting machine to be used in the fabrication of a part for one of its key products. The machine cost $120,000, and its estimated useful life was four years or 920,000 cuttings, after which it could be sold for $5,000. Required a. Calculate each year’s depreciation expense for the machine's useful life under each of the following depreciation methods (round all answers to the nearest dollar):1. Straight-line.2. Double-declining balance.3. Units-of-production. (Assume annual production in cuttings of 200,000; 350,000; 260,000; and 110,000.) 1. Straight-Line Year DepreciationExpense 2018 Answer 2019 Answer 2020 Answer 2021 Answer 2. Double-declining balance Year DepreciationExpense 2018 Answer 2019 Answer 2020 Answer 2021 Answer 2022 Answer 3. Units of Production Year DepreciationExpense 2018 Answer 2019 Answer 2020 Answer…
Current Attempt in Progress Devon Pharoah Company has provided information on intangible assets as follows. A patent was purchased from Shamrock Company for $1,600,000 on January 1, 2021. Pharoah estimated the remaining useful life of the patent to be 10 years. The patent was carried in Shamrock's accounting records at a net book value of $1,100,000 when Shamrock sold it to Pharoah. During 2022, a franchise was purchased from Sheffield Company for $490,000. In addition, 5% of revenue from the franchise must be paid to Sheffield. Revenue from the franchise for 2022 was $2,320,000. Pharoah estimates the useful life of the franchise to be 10 years and takes a full year's amortization in the year of purchase. Pharoah incurred research and development costs in 2022 as follows. Materials and equipment $159,000 Personnel 191,000 Indirect costs 114,000 $464,000 Pharoah estimates that these costs will be recouped by December 31, 2025, but due to uncertainty in the market, its process has not…
Computing Impairment of Intangible Assets Stiller Company had the following information for its three intangible assets. 1. Patent: A patent was purchased for $180,000 on June 30, 2018. Stiller estimated the useful life of the patent to be 15 years. On December 31, 2020, the estimated future cash flows attributed to the patent were $153,000. The fair value of the patent was $135,000. 2. Trademark: A trademark was purchased for $9,000 on August 31, 2019. The trademark is considered to have an indefinite life. The fair value of the trademark on December 31, 2020, is $4,500. 3. Goodwill: Stiller recorded goodwill in January 2019, related to a purchase of another company. The carrying value of goodwill is $54,000 on December 31, 2020. On December 31, 2020, the segment for which the goodwill relates had a fair value of $1,044,000. The book value of the net assets of the segment (including goodwill) is $1,080,000. Note: Round each of your answers to the nearest whole dollar. a. Classify each…
Rapids Company had assets as of December 31, 2022 of Original Accumulated Cost Depreciation/Amortization $50,000 $6,000 Asset Copyright Broadcasting license $50,000 $0 The company acquired the license in 2022. It is renewable every five years indefinitely Management is concerned about the value of the assets and decides to test for impairment. Management estimates the following information for each asset Asset Copyright Broadcasting license Undiscounted Future Cash Flows $57,000 $61,000 Fair Value $26,000 $25,000 What is the total amount of impairment loss for 2022? ENTER YOUR ANSWER AS A POSITIVE NUMBER.
Computing and Assessing Plant Asset ImpairmentZeibart Company purchased equipment for $225,000 on July 1, 2012, with an estimated useful life of 10 tears and expected salvage of $25,000. Straight line depreciation is used. On July 1, 2016, economic factors cause the fair value market to decline to $90,000. On this date, Zeibart examined for impairment and estimates $125,000 in future cash inflow related to use of this equipment.a. Is the equipment impaired at 7/1/2016? Explainb. If the equipment is impaired on 7/1/2016, compute the impairment loss and prepare a journal entry to record loss. c. What amount of depreciation expense would Zeibart record the 12 months from 7/1/2016 through 6/30/2017? Prepare a journal entry to record the depreciation expense. (no change in salvage)d. Using the financial statement effect template , show how the entries in part b & c affect Zeibart Company’s balance sheet and income statement.