In: Accounting
Working Notes : | |||
CALCULATION OF THE DEPRECIATION AS PER STRAIGHT LINE METHOD FOR BUILDING | |||
Purchase Cost of Building | $ 625,000 | ||
Less: Salvage Value | $ - | ||
Net Value for Depreciation (A) | $ 625,000 | ||
Usefule life of the Building (B) | 30 | Years | |
Depreciation per year = (A/B) | 20,833 | ||
Total Depreciation Per year = | $ 20,833 | ||
Solution: | |||
Adjusting entry at year end will be done as below, | |||
Date | Account Title | Debit | Credit |
Year End | Depreciation | $20,833 | |
Accumulated Depreciation - Building | $20,833 | ||
(To Record the depreciation expenses of the year) | |||