The following data relate to the Machinery account of Eshkol, Inc. at December 3
ID: 2498239 • Letter: T
Question
The following data relate to the Machinery account of Eshkol, Inc. at December 31, 2014.
Machinery
A
B
C
D
*In the year an asset is purchased, Eshkol, Inc. does not record any depreciation expense on the asset.
In the year an asset is retired or traded in, Eshkol, Inc. takes a full year’s depreciation on the asset.
The following transactions occurred during 2015.
Cash
13,130
Machinery (Machine A)
13,130
Prepare the necessary correcting entries for the year 2015. Record the appropriate depreciation expense on the above-mentioned machines. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Round answers to 0 decimal places, e.g. 45,892. Credit account titles are automatically indented when amount is entered. Do not indent manually.)
No.
Account Titles and Explanation
Debit
Credit
(a)
(To record current depreciation.)
(To properly record the sale.)
(b)
(c)
(d)
(To Record the original purchase of the machine.)
(To record depreciation.)
Machinery
A
B
C
D
Original cost $46,460 $51,510 $80,800 $80,800 Year purchased 2009 2010 2011 2013 Useful life 10 years 15,000 hours 15 years 10 years Salvage value $3,131 $3,030 $5,050 $5,050 Depreciation method Sum-of-the-years'-digits Activity Straight-line Double-declining balance Accum. depr through 2014* $31,512 $35,552 $15,150 $16,160Explanation / Answer
A)
$5656
Cost of machine A $ 46,460 Salvage value $ 3,131 Basis $ 43,329 Usefule life 10 years Accumulated depreciation =(43329 / 55 )*40 $ 31,512 Accmulated depreciation for 2015 = (43329 / 55 )*45 $ 35,451 Sales of machine $ 13,130 Basis $ 43,329 Accumulated depreciation $ 35,451 Book value $ 7,878 Sales Price $ 13,130 Gain (Loss ) on sales of machine $ 5,252Related Questions
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