70.2K

Verified Solution

Link Copied!

Answer the following in excel form, thank you!

On January 1 , Year 1 , a company purchased equipment. The details of the equipment purchase are below. \begin{tabular}{|l|r|} \hline Original Cost & $115,000 \\ Estimated Residual Value & $25,000 \\ \hline Estimated Useful Life & 6 \\ \hline Years in use until sold & 3 \\ \hline \end{tabular} Years in use until sold $75,000 Requirement 2: Sale amount Requirement 3: Sale amount $65,000 Requirement 4: Retired $0 Required: 1. Based on the information above, calculate Depreciation Expense, Accumulated Depreciation and Book Value of the equipment using the Straight-Line method for years 1-3. 2. Assume that the equipment is sold at the end of year 3 for the sale amount in cell B9. (a) Calculate the Gain or Loss on sale. (b) Prepare the journal entry to record sale of the asset. 3. Assume that the equipment is sold at the end of year 3 for the sale amount in cell B10. (a) Calculate the Gain or Loss on sale. (b) Prepare the journal entry to record sale of the asset. 4. Assume that the equipment is retired at the end of year 3 (zero proceeds, given in cell B11). (a) Calculate the Gain or Loss on retirement. (b) Prepare the journal entry to record retirement of the asset. Requirement 1: Straight-Line Method (Use cells A2 to B11 from the given information above to complete this question.) (Use cells A2 to B11 from the given information above to complete this question. Hint: A "gain" or "loss" account will auto-populate based on your answer in part (a). Show all values as positive amounts.) Requirement 3: Assume Equipment is Sold for Amount in Cell B10 (a) Calculate Gain or Loss on Sale: (Use cells A2 to B11 from the given information above to complete this question. Accumulated depreciation should be presented as a positive amount. Hint: In cell A65, input a conditional IF statement to return the word "Gain" if cell C65 is a positive amount or "Loss" if cell 665 is a negative amount.)

Answer & Explanation Solved by verified expert

See Answer