Question

In: Accounting

Hall Corp. purchases a new machine on October 1, 2018. Year end is December 31. Purchase...

Hall Corp. purchases a new machine on October 1, 2018. Year end is December 31.

Purchase price 100,000

Residual Value 5,000

Useful life 3 years

Estimated working hours during useful life 7,500

Machine usage in 2018 1,500

Machine usage in 2019 3,750

Machine usage in 2020 2,250

1. Calculate depreciation expense using the activity method for 2018

2. Prepare Hall Corp's journal entry to record 2018 depreciation on December 31, 2018

3. Calculate depreciation expense using the activity method for 2019

4. Prepare Hall Corp's journal entry to record 2019 depreciation on December 31, 2019

5. Calculate depreciation expense using the activity method for 2020

6. Prepare Hall's journal entry to record 2020 depreciation on December 31, 2020

Expert Solution

ekkarill92 answered 6 months ago

A company has a fiscal year-end of December 31: (1) on October 1, $14,000 was paid...

A company has a fiscal year-end of December 31: (1) on October 1, $14,000 was paid for a one-year fire insurance policy; (2) on June 30 the company lent its chief financial officer $12,000; principal and interest at 6% are due in one year; and (3) equipment costing $62,000 was purchased at the beginning of the year for cash. Prepare journal entries for each of the above transactions. (If no entry is required for a transaction/event, select "No journal entry...

Value Vintage Corp. is a second-hand thrift store. During the December 31, 2018 fiscal year end,...

Value Vintage Corp. is a second-hand thrift store. During the December 31, 2018 fiscal year end, the following accounts appeared in two of its trial balances: Unadjusted Adjusted Accounts payable $ 79,300 $ 79,300 Accounts receivable 95,300 95,300 Accumulated depreciation—building 42,100 52,500 Accumulated depreciation—equipment 29,600 42,900 Buildings 190,000 190,000 Cash 68,000 68,000 Common shares 160,000 160,000 Cost of goods sold 412,700 412,700 Depreciation expense 0 23,700 Dividends 28,000 28,000 Equipment 110,000 110,000 Insurance expense 0 7,200 Interest expense 3,000 11,000...

A wholesale business with December 31 year-end purchased new equipment on November 25, 2018, for 40,000....

A wholesale business with December 31 year-end purchased new equipment on November 25, 2018, for 40,000. Before 2018, the business owned no other equipment. Required: 1. Complete the table below to show the tax consequences. If the business sells the equipment in 2020 for (a)$15000 (b) $23000 (c) $46000. 2018 purchase: 2018 CCA: 2018 UCC: 2019 CCA: 2019 UCC: SITUATION A: Less: Disposal Proceeds: Interim UCC: Terminal Loss/ Recapture: Ending UCC: Situation B Less: Disposal Proceeds: Interim UCC: Terminal Loss/...

Question 1 Bee Clean Corp. has a year-end of December 31. Using the information and the...

Question 1 Bee Clean Corp. has a year-end of December 31. Using the information and the template for journal entries below, prepare the adjusting journal entries required at December 31, 2020 for the following transactions. No explanations are required. 1) On January 1, 2020, the company purchased and recorded a 5 year insurance policy for $10,000 in the Prepaid Insurance Account. 2) The company prepaid and recorded $9,000 for 3 months rent on November 1, 2020 in the Prepaid Rent...

Monty Corp. purchased a new machine on October 1, 2019, at a cost of $124,000. The...

Monty Corp. purchased a new machine on October 1, 2019, at a cost of $124,000. The company estimated that the machine will have a salvage value of $15,000. The machine is expected to be used for 10,000 working hours during its 4-year life. Compute the depreciation expense under straight-line method for 2019. (Round answer to 0 decimal places, e.g. 2,125.) 2019 Depreciation expense $ Compute the depreciation expense under units-of-activity for 2019, assuming machine usage was 1,860 hours. (Round...

1. Blue Spruce Corp. purchased a new machine on October 1, 2019, at a cost of...

1. Blue Spruce Corp. purchased a new machine on October 1, 2019, at a cost of $134,000. The company estimated that the machine will have a salvage value of $20,000. The machine is expected to be used for 10,000 working hours during its 5-year life. Compute the depreciation expense under straight-line method for 2019. (Round answer to 0 decimal places, e.g. 2,125.) 2019 Depreciation expense: 2. Yello Bus Lines uses the units-of-activity method in depreciating its buses. One bus was...

At the end of its first year of operations on December 31, 2018, the Hondo Company...

At the end of its first year of operations on December 31, 2018, the Hondo Company reported the following information for the year: (Assume any deferred tax assets are more likely than not to be realized). Pretax income for financial reporting purposes $360,000 Municipal bond interest revenue on State of Texas bonds 12,000 Warranty expense for financial reporting purposes Warranty repair costs during period 30,000 10,000 Excess of MACRS Depreciation for tax purposes above straight line for financial reporting purposes...

At the end of its first year of operations on December 31, 2018, the Skyway Company...

At the end of its first year of operations on December 31, 2018, the Skyway Company reported taxable income of $30,000 and a pretax financial loss of $40,000. Differences between taxable income and pretax financial income included:Environmental fine from the EPA = $20,000Warranty costs expensed for accounting purposes in excess of cash paid for warranty costs = $50,000(Those warranty costs are expected to be paid in 2019.) The enacted tax rates for 2018 and 2019 are 30% and 34%, respectively.REQUIRED:(a)...

Assume the year end for Oblix Company is December 31. Selected transactions of fiscal year 2018...

Assume the year end for Oblix Company is December 31. Selected transactions of fiscal year 2018 for Oblix Company are presented below. All accounts are in normal balance: Beginning balance account receivable, $8,162; beginning balance allowance for doubtful accounts, $272. Service revenue all on account, $75,906. Collections on account, $74,628. Write-offs of uncollectible accounts receivable, $200. Recovered an account receivable that had been previously been written off, $100. Aging schedule of accounts receivable at year-end: Days Outstanding Outstanding Amount %...

Grace Inc. has a December 31 year end. Grace had not received their December 2018 bill...

Grace Inc. has a December 31 year end. Grace had not received their December 2018 bill for their holiday party. Grace will accrue the estimated $5,000 cost at December 31, 2018. On January 28, 2019 ,after the financial statements were released, the final bill was received for the party of $5,250 and paid. 1) Complete the journal entries required relating to Grace Inc.at the below dates (if needed) assuming Grace does not use reversing entries: a) Dec 31, 2018 -...