70.2K

Verified Solution

Link Copied!

(1) A company purchased a truck on January 1, 2017 at a cost of $70,000. The truck had an estimated useful life of 5 years and an estimated salvage value of $10,000. The company uses the straight-line method of depreciation. Determine the book value of the truck on December 31, 2021.

(2) A company acquired equipment on April 1, 2020 for $160,000. The company estimates the useful life for the equipment is 400,000 units and the estimated salvage value is $60,000. If the company uses the units-of-activity method of depreciation, calculate the depreciation expense for 2020 if 8,000 units are produced.

(3) A company purchased factory equipment for $150,000. It is estimated that the equipment will have a $30,000 salvage value at the end of its estimated 5-year useful life. If the company uses the double-declining-balance method of depreciation, calculate the amount of annual depreciation recorded for the third year after purchase.

(4) On June 30, 2021, a company sold an old equipment for $24,000. The equipment originally cost $36,000 and had accumulated depreciation to the date of disposal of $15,000. Determine gain or loss from the disposal and Prepare the journal entry on the date of sale.

C. Prepare the entry to record bad debts expense for the period

Answer & Explanation Solved by verified expert

See Answer