Sale of Equipment
Equipment was acquired at the beginning of the year at a cost of $29,500. The equipment was depreciated using the double-declining-balance method based on an estimated useful life of ten years and an estimated residual value of $570.
a. What was the depreciation for the first
year?
$
b. Assuming the equipment was sold at the end
of year 2 for $6,820, determine the gain or loss on the sale of the
equipment.
$
c. Journalize the entry to record the sale. If an amount box does not require an entry, leave it blank.
In: Accounting
Sale of Equipment Equipment was acquired at the beginning of the year at a cost of $575,000. The equipment was depreciated using the straight-line method based on an estimated useful life of 9 years and an estimated residual value of $44,745. a. What was the depreciation for the first year? Round your answer to the nearest cent. $ b. Using the rounded amount from Part a in your computation, determine the gain(loss) on the sale of the equipment, assuming it was sold at the end of year eight for $98,037. Round your answer to the nearest cent and enter as a positive amount. $ c. Journalize the entry to record the sale. If an amount box does not require an entry, leave it blank. Round your answers to the nearest cent.
In: Accounting
Equipment was acquired at the beginning of the year at a cost of $75,720. The equipment was depreciated using the straight-line method based upon an estimated useful life of 6 years and an estimated residual value of $7,920.
Required:
| a. | What was the depreciation expense for the first year? |
| b. | Assuming the equipment was sold at the end of the second year for $57,370, determine the gain or loss on sale of the equipment. |
| c. | Journalize the entry to record the sale. Refer to the Chart of Accounts for exact wording of account titles. |
In: Accounting
Equipment was acquired at the beginning of the year at a cost of $79,560. The equipment was depreciated using the straight-line method based upon an estimated useful life of 6 years and an estimated residual value of $7,800.
a. What was the depreciation expense for the first year?
$
b. Assuming the equipment was sold at the end of the second year
for $60,100, determine the gain or loss on sale of the
equipment.
$
c. Journalize the entry to record the sale. If an amount box does not require an entry, leave it blank or enter "0".
In: Accounting
Computer equipment was acquired at the beginning of the year at a cost of $27,500 that has an estimated residual value of $1,700 and an estimated useful life of 5 years.
a. Determine the depreciable cost.
$
b. Determine the double-declining-balance rate.
%
c. Determine the double-declining-balance depreciation for the
first year.
$
In: Accounting
Equipment was acquired at the beginning of the year at a cost of $40,000. The equipment was depreciated using the double-declining-balance method based on an estimated useful life of ten years and an estimated residual value of $780. a. What was the depreciation for the first year?
b. Assuming the equipment was sold at the end of year 2 for $9,240, determine the gain or loss on the sale of the equipment. $fill in the blank
c. Journalize the entry to record the sale. If an amount box does not require an entry, leave it blank.
In: Accounting
Equipment was acquired at the beginning of the year at a cost of $562,500. The equipment was depreciated using the straight-line method based on an estimated useful life of 9 years and an estimated residual value of $40,600. a. What was the depreciation for the first year? Round your answer to the nearest cent.
b. Using the rounded amount from Part a in your computation, determine the gain(loss) on the sale of the equipment, assuming it was sold at the end of year eight for $92,889. Round your answer to the nearest cent and enter as a positive amount.
c. Journalize the entry to record the sale. If an amount box does not require an entry, leave it blank. Round your answers to the nearest cent.
In: Accounting
Equipment was acquired at the beginning of the year at a cost of $35,000. The equipment was depreciated using the A method of depreciation that provides periodic depreciation expense based on the declining book value of a fixed asset over its estimated life.double-declining-balance method based on an estimated useful life of ten years and an estimated The estimated value of a fixed asset at the end of its useful life.residual value of $680.
a. What was the The systematic periodic
transfer of the cost of a fixed asset to an expense account during
its expected useful life.depreciation for the first year?
$
b. Assuming the equipment was sold at the end
of year 2 for $8,090, determine the gain or loss on the sale of the
equipment.
$ Loss
Feedback
Book value is the asset cost minus accumulated depreciation. In the first year, the balance in the accumulated depreciation account is zero.
Compare the book value to the sale price. If the book value is more than the sale price, the equipment was sold for a loss. If the book value is less than the sale price, the equipment was sold for a gain.
Learning Objective 3.
c. Journalize the entry to record the sale. If an amount box does not require an entry, leave it blank.
Cash
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Accumulated Depreciation-Equipment
|
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Loss on Sale of Equipment
|
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Equipment
|
In: Accounting
Exercise 4-14 Tim Mattke Company began operations in 2018 and for simplicity reasons, adopted weighted-average pricing for inventory. In 2020, in accordance with other companies in its industry, Tim Mattke changed its inventory pricing to FIFO. The pretax income data is reported below.
| Year | Weighted-Average | FIFO |
| 2018 | $370,000 | $395,000 |
| 2019 | 390,000 | 430,000 |
| 2020 | 410,000 | 450,000 |
Q1
What is Tim Mattke’s net income in 2020? Assume a 20%
tax rate in all years.
| Net Income |
Q2
Compute the cumulative effect of the change in
accounting principle from weighted-average to FIFO inventory
pricing.
| Net effect |
Q3
Show comparative income statements for Tim Mattke Company, beginning with income before income tax, as presented on the 2020 income statement.
| 2020 | 2019 | 2018 | |
| Income before income tax | |||
| Income tax | |||
| Net income |
In: Finance
The comparative balance sheets of Coronado Inc. at the beginning
and the end of the year 2020 are as follows.
|
CORONADO INC. |
|||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
|
Dec. 31, 2020 |
Jan. 1, 2020 |
Inc./Dec. |
|||||||||
|
Assets |
|||||||||||
|
Cash |
$ 46,480 | $ 14,480 | $32,000 | Inc. | |||||||
|
Accounts receivable |
94,200 | 89,720 | 4,480 | Inc. | |||||||
|
Equipment |
42,200 | 23,720 | 18,480 | Inc. | |||||||
|
Less: Accumulated Depreciation-Equipment |
20,200 | 11,000 | 9,200 | Inc. | |||||||
|
Total |
$162,680 | $116,920 | |||||||||
|
Liabilities and Stockholders’ Equity |
|||||||||||
|
Accounts payable |
$ 23,200 | $ 16,720 | 6,480 | Inc. | |||||||
|
Common stock |
101,480 | 81,720 | 19,760 | Inc. | |||||||
|
Retained earnings |
38,000 | 18,480 | 19,520 | Inc. | |||||||
|
Total |
$162,680 | $116,920 | |||||||||
Net income of $47,200 was reported, and dividends of $27,680 were
paid in 2020. New equipment was purchased and none was sold.
Prepare a statement of cash flows for the year 2020.
(Show amounts that decrease cash flow with either a -
sign e.g. -15,000 or in parenthesis e.g.
(15,000).)
In: Accounting