Question

Straight Line Depreciation Class Example:

CC Coffee and Cookies Co. started operations in 2018.

1. On May 1, 2018, the Company purchased (on account): Coffee Machine for $1,300 and Mixer for $650

The journal entry to record the purchases is:

Date	Accounts	Debit	Credit
5/1/18

2. Compute Straight Line Depreciation for the Coffee Machine: Purchased May 1, $1,300 cost, $400 salvage value, 3 years useful life

Depreciation Calculation:               Depre. Exp. = cost – salvage value* (time in service)           

useful life

2018 Depreciation: $1,300 - $400 * (8/12) = $200

                                       3 years

2019 Depreciation:

                                      

2020 Depreciation:

                                      

2021 Depreciation:

                                      

Total Depreciation (2018-2021): $

3. The journal entry to record the Depreciation Expense for Year 1 is:

Date	Accounts	Debit	Credit
12/31/18	Depreciation Expense - Machine	$200
	Accumulated Deprec. - Machine		$200

The journal entry to record the Depreciation Expense for Year 2 is:

Date	Accounts	Debit	Credit
12/31/19

The journal entry to record the Depreciation Expense for Year 3 is:

Date	Accounts	Debit	Credit
12/31/20

The journal entry to record the Depreciation Expense for Year 4 is:

Date	Accounts	Debit	Credit
12/31/21

4. Compute Straight Line Depreciation for the Mixer: Purchased May 1, $650 cost, $50 salvage value, 4 years useful life

Depreciation Calculation: Depre. Exp. = cost – salvage value* (time in service)           

                                         useful life

2018 Depreciation: $650- $50 (8/12) = $100

                                       4 years

2019 Depreciation:

                                      

2020 Depreciation:

                                      

2021 Depreciation:

  

2022 Depreciation:

                                      

Total Depreciation (2018-2021):

5. The journal entry to record the Depreciation Expense for Year 1 is:

Date	Accounts	Debit	Credit
12/31/18

The journal entry to record the Depreciation Expense for Year 2 is:

Date	Accounts	Debit	Credit
12/31/19

The journal entry to record the Depreciation Expense for Year 3 is:

Date	Accounts	Debit	Credit
12/31/20

The journal entry to record the Depreciation Expense for Year 4 is:

Date	Accounts	Debit	Credit
12/31/21

The journal entry to record the Depreciation Expense for the last year is:

Date	Accounts	Debit	Credit
12/31/22

Answer 1