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Recording Asset Acquisition, Depreciation, and Disposal On January 2, 2016, Verdi Company acquired a machine...

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Accounting

Recording Asset Acquisition, Depreciation, and Disposal

On January 2, 2016, Verdi Company acquired a machine for $80,000. In addition to the purchase price, Verdi spent $15,000 for shipping and installation, and $1,500 to calibrate the machine prior to use. The company estimates that the machine has a useful life of 6 years and a residual value of $8,000.

Required a. Prepare journal entries to record the acquisition costs.

Description Debit Credit
1/2/2016 Answer
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b. Calculate the annual depreciation expense using straight-line depreciation and prepare a journal entry to record depreciation expense for 2016.

Description Debit Credit
12/31/2016 Answer
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c. On December 31, 2019, Verdi sold the machine to another company for $32,000. Prepare the necessary journal entry to record the sale.

Description Debit Credit
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Accumulated depreciation Answer Answer
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