Equipment acquired on January 6 at a cost of $532,255, has an estimated useful life of 19 years and an estimated residual value of $60,010.
Required:
a. What was the annual amount of depreciation for Years 1-3 using the straight-line method of depreciation?
b. What was the book value of the equipment on January 1 of Year 4?
c. Assuming that the equipment was sold on January 3 of Year 4 for $441,935, journalize the entry to record the sale. Refer to the chart of
accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used
for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered.
d. Assuming that the equipment had been sold on January 3 of Year 4 for $473,200 instead of $441,935, journalize the entry to record the sale.
Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a
journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered.
