FINANCIAL+MANAG.ACCT - CONNECT ACCESS
9th Edition
ISBN: 9781265318420
Author: Wild
Publisher: MCG
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Chapter 8, Problem 16E
To determine
Concept Introduction:
The effect of the given transactions on the accounting equation.
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Equipment acquired on January 9, 20Y3, at a cost of $633,000, has an estimated useful life of 16 years, an estimated residual value of $113,940, and is depreciated by the straight-line method.
a. What was the book value of the equipment at the end of the fifth year, December 31, 20Y7? Round your interim calculations and final answer to the nearest dollar.$
For decreases in accounts or outflows of cash, enter your answers as negative numbers. Round annual depreciation to the nearest dollar and use this amount in your follow-on calculations. If no account or activity is affected, select "No effect" from the dropdown and leave the corresponding number entry box blank.
b1. Assuming that the equipment was sold on July 1, 20Y8, for $189,900, illustrate the effects on the accounts and financial statement of depreciation for the six months until the sale date.
b2. Assuming that the equipment was sold on July 1, 20Y8, for $189,900, illustrate the effects on the accounts and financial…
Records show the following information for a plant asset purchased on October 1 of Year 1.
Cost
$ 330,000
Salvage Value
$ 39,000
Purchase Date
October 1
Useful Life
6 years
Calculate depreciation expense for Year 1 and Year 2 for the year ended December 31.
Depreciation expense for Year 1 for the year ended December 31
Depreciation Method
Straight-line
Depreciation expense for Year 2 for the year ended December 31
Entries for Sale of Fixed Asset
Equipment acquired on January 8 at a cost of $168,000 has an estimated useful life of 18 years, has an estimated residual value of $15,000, and is
depreciated by the straight-line method.
a. What was the book value of the equipment at December 31 the end of the fourth year?
3,024,00 x
Feedback
V Check My Work
Book value is the initial cost of the fixed asset minus the accumulated depreciation.
b. Assume that the equipment was sold on April 1 of the fifth year for $125,000.
1. Journalize the entry to record depreciation for the three months until the sale date. If an amount box does not require an entry, leave it blank.
Depreciation Expense-Equipment
Accumulated Depreciation-Equipment
Chapter 8 Solutions
FINANCIAL+MANAG.ACCT - CONNECT ACCESS
Ch. 8 - Prob. 1QSCh. 8 - Prob. 2QSCh. 8 - Prob. 3QSCh. 8 - Prob. 4QSCh. 8 - Prob. 5QSCh. 8 - Prob. 6QSCh. 8 - Prob. 7QSCh. 8 - Prob. 8QSCh. 8 - Prob. 9QSCh. 8 - Prob. 10QS
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