1) On January 1, 2016,Jah-Seed Corporation acquired a truck for $100.000 Residua
ID: 2601294 • Letter: 1
Question
1) On January 1, 2016,Jah-Seed Corporation acquired a truck for $100.000 Residual The truck can be driven for 50,000 miles over the next three years. Actual usage of the truck was recorded as for the first year. Give the journal entry to record depreciation for the first year calculated as per method. (Do not round your intermediate calculations.) (10pts) I value was estimated to be $20,000. 8,640 miles the units-of-production 2) On January 1, 2017, Jah-Corn Manufacturing Corporation purchased a machine for $40,000,000. The corporation expects to use the machine for 24,000 hours over the next six years. The estimated residual value of the machine at the end of the sixth year is $40,000. The corporation used the machine for 3,600 hours in 2017 and 5,000 hours in 2018. What is the depreciation expense for 2017 and 2018 if the corporation uses the double-declining-balance method of depreciation? (15pts) 3) Equipment was purchased for $24,000 on January 1, 2016. The equipment's estimated useful life was five years, and its residual value was $4,000. The straight-line method of depreciation was used. Calculate the gain or loss on sale if the equipment is sold for $18,000 on December 31, 2016, the end of the accounting period. Prepare the journal entry to record the sale of equipment. (20pts)Explanation / Answer
Solution:-
Depreciation rate = (100,000 - 20,000) / 50,000 = $ 1.6 per miles.
Depreciation expense for first year = 8,640 Miles * $ 1.6 = $ 13,824
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