At the beginning of the year, Young Company bought three used machines from Vinc
ID: 2465797 • Letter: A
Question
At the beginning of the year, Young Company bought three used machines from Vince, Inc. The machines immediately were overhauled, were installed, and started operating. Because the machines were different, each was recorded separately in the accounts
By the end of the first year, each machine had been operating 5,000 hours.
Compute the cost of each machine.
Prepare the journal entry to record depreciation expense at the end of year 1, assuming the following:(Do not round intermediate calculations. If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)
At the beginning of the year, Young Company bought three used machines from Vince, Inc. The machines immediately were overhauled, were installed, and started operating. Because the machines were different, each was recorded separately in the accounts
Explanation / Answer
Solution:
Machine A
Machine B
Machine C
Amount paid for asset
$8,450
$27,300
$11,000
+ Installation costs
450
850
750
+ Renovation costs prior to use
3,200
1,600
1,150
Cost of machine
$12,100
$29,750
$12,900
Machine A
Machine B
Machine C
Amount paid for asset
$8,450
$27,300
$11,000
+ Installation costs
450
850
750
+ Renovation costs prior to use
3,200
1,600
1,150
Cost of machine
$12,100
$29,750
$12,900
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