Equipment acquired on January 8, 2013, at a cost of $165,730, has an estimated useful life of 17 years, has an estimated residual value of $8,650, and is depreciated by the straight-line method.

Required:

A.

What was the book value of the equipment at December 31, 2016, the end of the year?

B.

Assuming that the equipment was sold on July 1, 2017, for $118,345, journalize the entries to record (1) depreciation for the six months until the sale date, and (2) the sale of the equipment. Refer to the Chart of Accounts for exact wording of account titles.

JOURNAL

	DATE	DESCRIPTION	POST. REF.	DEBIT	CREDIT
1
2

JOURNAL

	DATE	DESCRIPTION	POST. REF.	DEBIT	CREDIT
1
2
3
4

PART II

Equipment acquired on January 6, 2013, at a cost of $417,390, has an estimated useful life of 17 years and an estimated residual value of $68,805.

Required:

A.

What was the annual amount of depreciation for the years 2013, 2014, and 2015 using the straight-line method of depreciation?

2013 depreciation expense
2014 depreciation expense
2015 depreciation expense

B.

What was the book value of the equipment on January 1, 2016?

C.

Assuming that the equipment was sold on January 3, 2016, for $339,855, journalize the entry to record the sale. Refer to the Chart of Accounts for exact wording of account titles.

JOURNAL

	DATE	DESCRIPTION	POST. REF.	DEBIT	CREDIT
1
2
3
4

D.

Assuming that the equipment had been sold on January 3, 2016, for $368,885 instead of $339,855, journalize the entry to record the sale. Refer to the Chart of Accounts for exact wording of account titles.

JOURNAL

	DATE	DESCRIPTION	POST. REF.	DEBIT	CREDIT
1
2
3
4