Quade Corporation bought a copy machine on January 7 of the current year for $2,360. It has an estimated useful life of five years and an estimated disposal value of $100.

Instructions 

In your working papers:

1. Prepare a depreciation schedule for the copy machine using the straight-line method of depreciation. (Use the form provided in your working papers.)

2. Journalize the adjustment for the copy machine’s depreciation at the end of the first year.

3. Journalize the closing entry for the expense account affected by the adjusting entry.

4. What is the book value of the asset after five years? Is this the same as the disposal value?