On April 1, 2014, the KB Toy Company purchased equipment to be used in its...
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Accounting
| On April 1, 2014, the KB Toy Company purchased equipment to be used in its manufacturing process. The equipment cost $60,800, has an eight-year useful life, and has no residual value. The company uses the straight-line depreciation method for all manufacturing equipment. |
| On January 4, 2016, $15,200 was spent to repair the equipment and to add a feature that increased its operating efficiency. Of the total expenditure, $3,300 represented ordinary repairs and annual maintenance and $11,900 represented the cost of the new feature. In addition to increasing operating efficiency, the total useful life of the equipment was extended to 10 years. |
| Required: | |
| 1. | Prepare journal entries for the depreciation for 2014 and 2015 Prepare journal entries for the 2016 expenditure
|
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