1 A machine costing $59,375 with a 5 year life and $3,600 residual value was purchased January 2 Compute depreciation for each of the five years, using the double declining balance method Year Depreciation Year 1 $ Year 2 $ Year 3 $ Year 4 $ Year 5 $ 2 An asset was purchased for $71,000 and originally estimated to have a useful life of 10 years with a residual value of $3,400 After two years of straight line depreciation, it was determined that the remaining useful life of the asset was only 2 years with a residual value of $1,360 a Determine the amount of the annual depreciation for the first two years $ b Determine the book value at the end of Year 2 $ c Determine the depreciation expense for each of the remaining years after revision $ 3 CHART OF ACCOUNTS Lucite Company General Ledger ASSETS 110 Cash 111 Petty Cash 121 Accounts Receivable Alan Albertson 122 Accounts Receivable Jim Dobbs 123 Accounts Receivable John Groves 124 Accounts Receivable Jan Lehn 125 Accounts Receivable Jacob Marley 126 Accounts Receivable Mr Potts 127 Accounts Receivable Chad Thomas 128 Accounts Receivable Andrew Warren 129 Allowance for Doubtful Accounts 131 Interest Receivable 132 Notes Receivable Alan Albertson 141 Inventory 145 Supplies 151 Prepaid Insurance 181 Land 191 Equipment 192 Accumulated Depreciation LIABILITIES 210 Accounts Payable 211 Salaries Payable 213 Sales Tax Payable 214 Interest Payable 215 Notes Payable EQUITY 310 Common Stock 311 Retained Earnings 312 Dividends REVENUE 410 Sales 610 Interest Revenue EXPENSES 510 Cost of Goods Sold 520 Salaries Expense 521 Advertising Expense 522 Depreciation Expense 523 Delivery Expense 524 Repairs Expense 531 Rent Expense 533 Insurance Expense 534 Supplies Expense 536 Credit Card Expense 537 Cash Short and Over 538 Bad Debt Expense 539 Miscellaneous Expense 710 Interest Expense General Journal Journalize the entry for the transaction on November 14 Refer to the Chart of Accounts for exact wording of account titles PAGE 1 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST REF DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 2 Journalize the entry for the transaction on December 31 Refer to the Chart of Accounts for exact wording of account titles Round your answers to two decimal places Assume a 360 day year when calculating interest PAGE 1 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST REF DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 2 Journalize the entry for the transaction on February 12 Refer to the Chart of Accounts for exact wording of account titles Round your answers to two decimal places Assume a 360 day year when calculating interest PAGE 1 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST REF DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 2 3 4

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1. A machine costing $59,375 with a 5-year life and $3,600 residual value was purchased January 2. Compute depreciation for each of the five years,

1. A machine costing $59,375 with a 5-year life and $3,600 residual value was purchased January 2. Compute depreciation for each of the five years, using the double-declining-balance method.

Year		Depreciation
Year 1		$
Year 2		$
Year 3		$
Year 4		$
Year 5		$

An asset was purchased for $71,000 and originally estimated to have a useful life of 10 years with a residual value of $3,400. After two years of straight-line depreciation, it was determined that the remaining useful life of the asset was only 2 years with a residual value of $1,360.

a. Determine the amount of the annual depreciation for the first two years. $

b. Determine the book value at the end of Year 2. $

c. Determine the depreciation expense for each of the remaining years after revision. $

CHART OF ACCOUNTS

Lucite Company

General Ledger

	ASSETS
110	Cash
111	Petty Cash
121	Accounts Receivable-Alan Albertson
122	Accounts Receivable-Jim Dobbs
123	Accounts Receivable-John Groves
124	Accounts Receivable-Jan Lehn
125	Accounts Receivable-Jacob Marley
126	Accounts Receivable-Mr.Potts
127	Accounts Receivable-Chad Thomas
128	Accounts Receivable-Andrew Warren
129	Allowance for Doubtful Accounts
131	Interest Receivable
132	Notes Receivable-Alan Albertson
141	Inventory
145	Supplies
151	Prepaid Insurance
181	Land
191	Equipment
192	Accumulated Depreciation

	LIABILITIES
210	Accounts Payable
211	Salaries Payable
213	Sales Tax Payable
214	Interest Payable
215	Notes Payable

	EQUITY
310	Common Stock
311	Retained Earnings
312	Dividends

	REVENUE
410	Sales
610	Interest Revenue

	EXPENSES
510	Cost of Goods Sold
520	Salaries Expense
521	Advertising Expense
522	Depreciation Expense
523	Delivery Expense
524	Repairs Expense
531	Rent Expense
533	Insurance Expense
534	Supplies Expense
536	Credit Card Expense
537	Cash Short and Over
538	Bad Debt Expense
539	Miscellaneous Expense
710	Interest Expense

General Journal

Journalize the entry for the transaction on November 14. Refer to the Chart of Accounts for exact wording of account titles.

PAGE 1

JOURNAL

ACCOUNTING EQUATION

	DATE	DESCRIPTION	POST. REF.	DEBIT	CREDIT	ASSETS	LIABILITIES	EQUITY
1
2

Journalize the entry for the transaction on December 31. Refer to the Chart of Accounts for exact wording of account titles. Round your answers to two decimal places. Assume a 360-day year when calculating interest.

PAGE 1

JOURNAL

ACCOUNTING EQUATION

	DATE	DESCRIPTION	POST. REF.	DEBIT	CREDIT	ASSETS	LIABILITIES	EQUITY
1
2

Journalize the entry for the transaction on February 12. Refer to the Chart of Accounts for exact wording of account titles. Round your answers to two decimal places. Assume a 360-day year when calculating interest.

PAGE 1

JOURNAL

ACCOUNTING EQUATION