*urgent* 1. Complete the depreciation schedule below 2. Provide the general jour

Question

*urgent* 1. Complete the depreciation schedule below 2. Provide the general journal entry to recognize the betterment of upgrading the transmission. Problem 4 Purchase Date Information Cost Estimated Salvage Useful life in yrs Revision Information After year three (3), transmission is replaced at a cost of $8,000. Useful life is now expected to be four (4) years after betterment vs two (2) years Salvage value is estimated to be $3,000 vs $2,000 $62,000 $2,000 Requirement: Update the depreciation schedule according to revisions listed above. Delivery Truck: Straight Line Depreciation Annual End of Year Depreciable X Depreciation= Depreciation Accumulated Expense $12,000 12,000 12,000 Costate Depreciation Book Value Year $60,000 60,000 60,000 20% 20% 20% $12,000 24,000 36,000 50,000 38,000 26,000 Journalize the betterment transaction. ACCT DEBIT

Explanation / Answer

End of Year Year Depreciable cost* Depreciation Rate= Annual Depreciation expense Accumulated Depn. Book Value 62000 1 60000 20% 12000 12000 50000 2 60000 20% 12000 24000 38000 3 60000 20% 12000 36000 26000 Upgrading (62000+8000) 70000 4 31000 25% 7750 43750 26250 5 31000 25% 7750 51500 18500 6 31000 25% 7750 59250 10750 7 31000 25% 7750 67000 3000 (Salvage) J/E to recognise betterment of transmission Debit Credit Transmission 8000 Cash/ Accounts payable 8000 Depreciable cost from 4th year= 26000+8000-3000= 31000 St.line depn. Rate= 1/4= 25%

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