In: Accounting
Howarth Manufacturing Company purchased equipment on June 30,
2017, at a cost of $110,000. The residual value of the equipment
was estimated to be $8,000 at the end of a five-year life. The
equipment was sold on March 31, 2021, for $30,000. Howarth uses the
straight-line depreciation method for all of its plant and
equipment. Partial-year depreciation is calculated based on the
number of months the asset is in service.
Required:
1. Prepare the journal entry to record the
sale.
2. Assuming that Howarth had instead used the
double-declining-balance method, prepare the journal entry to
record