Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Find depreciation and check if there is a mistake before it Gigi Ltd bought a machine on credit on April 25, 2020 with a value

image text in transcribedFind depreciation and check if there is a mistake before it

Gigi Ltd bought a machine on credit on April 25, 2020 with a value of 4 000, 300 of transportation costs, 200 of non-deductible tax costs and 500 of decuctible tax costs. The the machine was first used the 1st of May. The total useful life of the machine is estimated at 30 years and the depreciation method is the straight-line method. The closing date is the 31 of december 2021. a. Identify the accounting entry attached to this transaction? b. What will be the amount of depreciation at the closing date (considering that each month of the year = 30 days and a year = 360 days? a. The main transaction is a purchase of a non current asset so we need to credit the account "machine" for 4000 , impacting the balance sheet). This purchase on credit induces the creation of an equity represented by a increase impacting the income statement throught the debitside. b. The amount of depreciation at the closing date will be

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Latest Certified Quality Auditor Certification Actual Questions

Authors: Pass For Life

1st Edition

108127705X, 978-1081277055

More Books

Students also viewed these Accounting questions

Question

8. Explain the relationship between communication and context.

Answered: 1 week ago

Question

d. How were you expected to contribute to family life?

Answered: 1 week ago