Exercise 8-11A Events related to the acquisition, use, and disposal of a tangible plant asset: straight-line depreciation LO 8-2, 8-5 City Taxi Service purchased a new auto to use as a taxi on January 1, Year 1, for $36,000. In addition, City paid sales tax and title fees of $1,200 for the vehicle. The taxi is expected to have a five-year life and a salvage value of $4,000. Required a. Using the straight-line method, compute the depreciation expense for Year 1 and Year 2. b&c. Assume that the taxi was sold on January 1, Year 3, for $22,000. Prepare the general journal entries to record the Year 1 depreciation and sale of the taxi in Year 3. Complete this question by entering your answers in the tabs below. Reg A Reg B and C Using the straight-line method, compute the depreciation expense for Year 1 and Year 2. Year 1 Year 2 Depreciation expense Reg A Reg B and C > Exercise 8-11A Events related to the acquisition, use, and disposal of a tangible plant asset: straight-line depreciation LO 8-2, 8-5 City Taxi Service purchased a new auto to use as a taxi on January 1, Year 1, for $36,000. In addition, City paid sales tax and title fees of $1,200 for the vehicle. The taxi is expected to have a five-year life and a salvage value of $4,000. Required a. Using the straight-line method, compute the depreciation expense for Year 1 and Year 2. b&c. Assume that the taxi was sold on January 1, Year 3, for $22,000. Prepare the general journal entries to record the Year 1 depreciation and sale of the taxi in Year 3. Complete this question by entering your answers in the tabs below. Reg A Reg B and C Assume that the taxi was sold on January 1, Year 3, for $22,000. Prepare the general journal entries to record the Year 1 depreciation and sale of the taxi in Year 3. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet Record depreciation expense. Note: Enter debits before credits. General Journal Debit Credit Date Year 1 Exercise 8-11A Events related to the acquisition, use, and disposal of a tangible plant asset: straight-line depreciation LO 8-2, 8-5 City Taxi Service purchased a new auto to use as a taxi on January 1, Year 1, for $36,000. In addition, City paid sales tax and title fees of $1.200 for the vehicle. The taxi is expected to have a five-year life and a salvage value of $4,000. Required a. Using the straight-line method, compute the depreciation expense for Year 1 and Year 2 b&c. Assume that the taxi was sold on January 1, Year 3, for $22,000. Prepare the general journal entries to record the Year 1 depreciation and sale of the taxi in Year 3. Complete this question by entering your answers in the tabs below. Reg A Reg B and C Assume that the taxi was sold on January 1, Year 3, for $22,000. Prepare the general journal entries to record the Year 1 depreciation and sale of the taxi in Year 3. (If no entry is required for a transaction/event, select "No journal entry required in the first account field.) View transaction list Journal entry worksheet Record entry for sale of taxi and loss on sale. Note: Enter debits before credits. General Journal Debit Credit Date Year 3 Problem 8-27A Effect of straight-line versus double-declining-balance depreciation on the recognition of expense and gains or losses LO 8-2, 8-3, 8-5 Becker Office Service purchased a new computer system in year 1 for $40.000. It is expected to have a five-year useful life and a $5,000 salvage value. The company expects to use the system more extensively in the early years of its life. Required a. Calculate the depreciation expense for each of the five years, assuming the use of straight-line depreciation. Year Depreciation Expense b. Calculate the depreciation expense for each of the five years, assuming the use of double-declining-balance depreciation. Depreciation Year Expense d. Assume that Becker Office Service sold the computer system at the end of the fourth year for $15.000. Compute the amount of gain or loss using each depreciation method. Straight-Line Double-Declining- Balance Problem 8-30A Calculating depreciation expense using four different methods LO 8-2, 8-3, 8-4, 8-6 Banko Inc. manufactures sporting goods. The following information applies to a machine purchased on January 1. Year 1: Purchase price Delivery cost Installation charge Estimated life Estimated units Salvage estimate $ 70, 80e $ 3.eas $ 1,eee 5 years 140, eee $ 4,000 During Year 1, the machine produced 36.000 units, and during Year 2 it produced 38,000 units. Required a. Determine the amount of depreciation expense for Year 1 and Year 2 using straight-line method. b. Determine the amount of depreciation expense for Year 1 and Year 2 using double-declining-balance method. c. Determine the amount of depreciation expense for Year 1 and Year 2 using units of production method. d. Determine the amount of depreciation expense for Year 1 and Year 2 using MACRS, assuming that the machine is classified as seven-year property. (Round your answers to the nearest dollar amount.) MACRS table: Year 5-Year property,% 20.ee 32.ee 19.20 11.52 11.52 5.76 2-Year property,% 14.29 24.49 17.49 12.49 8.93 8.92 8.93 4.46 Year 1 Year 2 r a. Depreciation expense b. Depreciation expense c. Depreciation expense d. Depreciation expense