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211 a company paid 320 000 for equipment that was expected to last five years and to 4296341

 

211.A company paid $320,000 for equipment that was expected to last five years and to have a salvage value of $40,000. During the third year of the equipment's life, $39,000 cash was paid for replacement parts that were expected to increase productivity by 10% each year. Prepare the journal entry to record the $39,000 cost incurred in the third year.  
 
 

212.On January 1, a company purchased machinery for $75,000 that had a 6-year useful life and a salvage value of $6,000. After three years of straight-line depreciation, the company paid $8,500 cash at the beginning of the year to improve the efficiency of the machinery. The productivity of the machinery was improved without increasing its remaining useful life or changing its salvage value. Straight-line depreciation is used throughout the machinery's life.

1. Prepare the journal entry to record the $8,500 expenditure.
2. Prepare the journal entry to record depreciation expense for the fourth year.  
 
 

213.A company sold a machine that originally cost $90,000 for $28,000 cash. The accumulated depreciation on this machine was $47,000 at the time of the sale. What was the company's gain or loss on this sale?  
 
 

214.Wallace Company had a building that was destroyed by fire. The building originally cost $650,000, and its accumulated depreciation as of the date of the fire was $300,000. The company received $320,000 cash from an insurance policy that covered the building and will use that money to help rebuild. Prepare the single journal entry to record the disposal of the building and the receipt of cash from the insurance company.  
 
 

215.On April 1, 2015, due to obsolescence resulting from a new technology, a company discarded a computer that cost $5,000, had a useful life of 4 years, and a salvage value of $400. Based on straight-line depreciation, the accumulated depreciation as of December 31, 2014 was $3,450.

a. Prepare the journal entry to record depreciation up to the date of disposal of the computer.
b. Prepare the journal entry to record the disposal of the computer.  
 
 

 

 

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