00:01
Equipment acquired on january 8th had a cost of $212 ,000, an estimated useful life of 15 years and a residual value of 14 ,000.
00:11
What is the book value of the equipment at the end of the fifth year? straightline depreciation, you take the cost and subtract the salvage value, or the residual value, and divided by the useful life.
00:26
This gets me depreciation of $39 ,600 per year.
00:32
So for five years, that would amount to $198 ,000.
00:41
The book value would be the initial cost minus this depreciation.
00:47
That would get me $14 ,000.
00:55
Part b says assuming the equipment was sold at the sixth year for 105 ,800, journalize the entries to record depreciation for the first three months of the sale date.
01:08
If it's 39 ,600 per year, three out of 12 months in the year would just amount to 9 ,900 of additional depreciation.
01:19
So you would debit depreciation expense to show that this time passed and we're allocating this cost...