At the beginning of the year, Grillo Industries bought three used machines from

Question

At the beginning of the year, Grillo Industries bought three used machines from Freeman Incorporated. The machines immediately were overhauled, were installed, and started operating Because the machines were different, each was reoorded separately in the accounts Cost of the asset Installation costs Renovation costs prior to use Repairs after production began800,000 Machine A Machine B Machine C 10.900 $40,100 $23,900 4,000 3,600 1,000 800 3,100 4.100 2,600 By the end of the first year, each machine had been operating 8,000 hours Required: 1. Compute the cost of each machine $ 12,700 S 47,700 S 31,100 2. Prepare the journal entry to record depreciasion expense at the end of year 1, assuming the following (r no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Do not round intermediate calculations) 5 years 20.,000 hours 10 years $ 2.900 2,500 1,700 Double-dedlining-balanoe Journal entry worksheet Record the depreciation expense for the three used machines at the end of year 1. General Journal Machine A Machine B Depreciation - Machine C

Explanation / Answer

Journal entry :

Date accounts & explanation debit credit Depreciation expense 26260     Accumlated depreciation-Machine A (12700-2900/5) 1960     Accumlated depreciation-Machine B (47700-2500/20000*8000) 18080     Accumlated depreciation-Machine C (31100*20%) 6220 (To record depreciation)

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