Answered step by step
Verified Expert Solution
Question
1 Approved Answer
AP8-12A (Straight-line and double-diminishing-balance depreciation with disposal) On March 1, 2023, Zephur Winds Ltd. purchased a machine for $80,000 by paying $20,000 down and issuing
AP8-12A (Straight-line and double-diminishing-balance depreciation with disposal) On March 1, 2023, Zephur Winds Ltd. purchased a machine for $80,000 by paying $20,000 down and issuing a note for the balance. The machine had an estimated useful life of nine years and an estimated residual value of $8,000. Zephur Winds uses the straight-line method of depreciation and has a December 31 year end. On October 30, 2025, the machine was sold for \$62,000. Required a. Prepare the journal entry to record the acquisition of the machine. b. Assuming that the depreciation was correctly calculated and recorded in 2023 and 2024, prepare the journal entries to update the depreciation and record the sale of the machine on October 30, 2025. c. Assume instead that the company used the double-diminishing-balance method to depreciate the cost of the machine: i. What amount of depreciation would be recorded in 2023 and 2024 ? ii. What journal entries would be required to update the depreciation and record the sale of the machine on October 30,2025
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started