Horngren's Accounting
11th Edition
ISBN: 9780133851151
Author: MILLER-NOBLES, Tracie L., Mattison, Brenda., Matsumura, Ella Mae, Horngren, Charles T.
Publisher: Pearson,
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Chapter 10, Problem S10.7SE
Discarding of a fully
On June 15, 2015, Perfect Furniture discarded equipment that had a cost $12,000, a residual value of $0, and was fully deprecited. Journalize the diposal of the equipment.
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Discarding an asset
On October 31, 2018, Alternative Landscapes discarded equipment that had a cost of $26,920. Accumulated Depreciation as of December 31, 2017, was $25,000. Assume annual depreciation on the equipment is $1,920. Journalize the partial-year depreciation expense and disposal of the equipment.
Equipment acquired on January 3, 2007, at a cost of $504,000, has an estimated useful
life of 12 years, has an estimated residual value of $42,000, and is depreciated by the straight-line method.
a. Prepare a working paper to support your answers.
b. Assuming that the equipment was disposed on December 31, 2015, journalize the disposal entries
c. Assuming that the equipment was sold on April 1, 2011, for $315,000, journalize the entries to record
(1) depreciation for the three months until the sale date, and
(2) the sale of the equipment.
d. Assuming that the equipment was sold on April 1, 2011, for $420,000, journalize the entries to record
(1) depreciation for the three months until the sale date, and
(2) the sale of the equipment.
On December 31, Strike Company has decided to discard one of its batting cages. The initial cost of the equipment was $208,831.00 with an accumulated depreciation of $187,947.90. Depreciation has been taken up to the end of the year. The following will be included in the entry to record the disposal.
Select the correct answer.
Accumulated Depreciation Dr. $208,831.00
Equipment Cr. $208,831.00
Gain on Disposal of Asset Cr. $20,883.10
Loss on Disposal of Asset Dr. $187,947.90
Chapter 10 Solutions
Horngren's Accounting
Ch. 10 - Prob. 1QCCh. 10 - Prob. 2QCCh. 10 - Which method almost always produces the most...Ch. 10 - A Celty Airline jet costs $28,000,000 and expected...Ch. 10 - Prob. 5QCCh. 10 - Prob. 6QCCh. 10 - Prob. 7QCCh. 10 - Prob. 8QCCh. 10 - Prob. 9QCCh. 10 - Prob. 10AQC
Ch. 10 - Prob. 1RQCh. 10 - Plant assets are recorded at historical cost. What...Ch. 10 - Prob. 3RQCh. 10 - Prob. 4RQCh. 10 - Prob. 5RQCh. 10 - Prob. 6RQCh. 10 - What is depreciation? Define useful life, residual...Ch. 10 - Which depreciation method ignores residual value...Ch. 10 - How does a business decide which depreciation...Ch. 10 - What is the depreciation method that is used for a...Ch. 10 - If a business changes the estimated useful life or...Ch. 10 - Prob. 12RQCh. 10 - How is discarding of a plant asset different from...Ch. 10 - How is gain or loss determined when disposing of...Ch. 10 - Prob. 15RQCh. 10 - Prob. 16RQCh. 10 - Prob. 17RQCh. 10 - Prob. 18RQCh. 10 - Prob. 19RQCh. 10 - What does it mean if an exchange of plant assets...Ch. 10 - Prob. S10.1SECh. 10 - Prob. S10.2SECh. 10 - Prob. S10.3SECh. 10 - Prob. S10.4SECh. 10 - Prob. S10.5SECh. 10 - Prob. S10.6SECh. 10 - Discarding of a fully depreciated asset On June...Ch. 10 - Prob. S10.8SECh. 10 - Prob. S10.9SECh. 10 - Prob. S10.10SECh. 10 - Prob. S10.11SECh. 10 - Prob. S10.12SECh. 10 - Prob. S10.13SECh. 10 - Prob. S10.14SECh. 10 - Prob. S10A.15SECh. 10 - Prob. S10A.16SECh. 10 - Prob. E10.17ECh. 10 - Prob. E10.18ECh. 10 - Prob. E10.19ECh. 10 - Prob. E10.20ECh. 10 - Prob. E10.21ECh. 10 - Prob. E10.22ECh. 10 - Prob. E10.23ECh. 10 - Prob. E10.24ECh. 10 - Prob. E10.25ECh. 10 - Prob. E10.26ECh. 10 - Prob. E10.27ECh. 10 - Prob. E10.28AECh. 10 - Prob. E10.29AECh. 10 - Prob. P10.30APGACh. 10 - Determining asset cost, recording first-year...Ch. 10 - P10-32A Recording lump-sum asset purchases,...Ch. 10 - Prob. P10.33APGACh. 10 - Prob. P10.34APGACh. 10 - Prob. P10A.35APGACh. 10 - Prob. P10.36BPGBCh. 10 - Determining asset cost, recording first-year...Ch. 10 - Prob. P10.38BPGBCh. 10 - Prob. P10.39BPGBCh. 10 - Prob. P10.40BPGBCh. 10 - Prob. P10A.41BPGBCh. 10 - Prob. P10.42CP
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- Which of the following is not true about the MACRS depreciation system: A salvage value must be determined before depreciation percentages are applied to depreciable real estate. Residential rental buildings are depreciated over 27.5 years straight-line. Commercial real estate buildings are depreciated over 39 years straight-line. No matter when during the month depreciable real estate is purchased, it is considered to have been placed in service at mid-month for MACRS depreciation purposes.arrow_forwardWhen depreciation is recorded each period, what account is debited? a. Depreciation Expense b. Cash c. Accumulated Depreciation d. The fixed asset account involved Use the following information for Multiple-Choice Questions 7-4 through 7-6: Cox Inc. acquired a machine for on January 1, 2019. The machine has a salvage value of $20,000 and a 5-year useful life. Cox expects the machine to run for 15,000 machine hours. The machine was actually used for 4,200 hours in 2019 and 3,450 hours in 2020.arrow_forwardDisposal of Fixed Asset Pacifica Manufacturing retired a computerized metal stamping machine on December 31, 2019. Pacifica sold the machine to another company and did not replace it. The following data are available for the machine: The machine was sold for $225,000 cash. Pacifica uses the straight-line method of depreciation. Required: 1. Prepare the journal entry to record depreciation expense for 2019. 2. Compute accumulated depreciation at December 31, 2019. 3. Prepare the journal entry to record the sale of the machine. 4. CONCEPTUAL CONNECTION Explain how the disposal of the fixed asset would affect the 2019 financial statements. Ignore income taxes.arrow_forward
- In recent years, Waterfront Transportation purchased one used bus. The accountant selected the straight line method to compute the depreciation. Information concerning the bus is summarized as follow. Bus Acquired cost salvage Value Useful Life in Years Depreciation Method 1 1/1/12 $86,000 $6,000 4 Straight-line Compute the amount of accumulated depreciation at December 31, 2014 If the bus was purchased on April 1 instead of January 1,what is the depreciation expense for the bus in (1) 2012 and (2) 2013arrow_forwardIn recent years, Waterfront Transportation purchased one used bus. The accountant selected the straight line method to compute the depreciation. Information concerning the bus is summarized as follow. Bus Acquired cost salvage Value Useful Life in Years Depreciation Method 1 1/1/12 $86,000 $6,000 4 Straight-line Compute the amount of accumulated depreciation at December 31, 2014 If the bus was purchased on April 1 instead of January 1,what is the depreciation expense for the bus in (1) 2012 and (2) 2013.( formula:2 marks; computationarrow_forwardWardell Company purchased a mini computer on January 1, 2014, at a cost of $40,000. The computer has been depreciated using the straight-line method over an estimated five-year useful life with an estimated residual value of $4,000. On January 1, 2016, the estimate of useful life was changed to a total of 10 years, and the estimate of residual value was changed to $900. Required: 1. Prepare the appropriate adjusting entry for depreciation in 2016 to reflect the revised estimate. 2. Repeat requirement 1 assuming that the company uses the sum-of-the-years’-digits method instead of the straight-line method.arrow_forward
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