Question
a)At December 31, 2017, the company decided to change the depreciation method on its office equipment from double-declining-balance to straight-line. The equipment had an original
a)At December 31, 2017, the company decided to change the depreciation method on its office equipment from double-declining-balance to straight-line. The equipment had an original cost of $200,000 when purchased on January 1, 2015. It has a 10-year useful life and no salvage value. Depreciation expense recorded prior to 2017 under the double-declining-balance method was $72,000. They have already recorded 2017 depreciation expense of $25,600 using the double-declining-balance method.Prepare the necessary journal entry at December 31, 2017 before they close their books.
Debit
Credit
b)Insurance for a 12-month period purchased on November 1 of this year was charged to insurance expense in the amount of $3,300 because "the amount of the check is about the same every year."Prepare the necessary journal entry at December 31, 2017 before they close their books.
Debit
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c)Reported sales revenue for the year is $1,908,000. This includes all sales taxes collected for the year. The sales tax rate is 6%. Because the sales tax is forwarded to the state's Department of Revenue, the Sales Tax Expense account is debited. The bookkeeper thought that "the sales tax is a selling expense." At the end of the current year, the balance in the Sales Tax Expense account is $103,400. Prepare the necessary journal entry at December 31, 2017 before they close their books.
Debit
Credit
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