Question
Howarth Manufacturing Company purchased equipment on June 30, 2017, at a cost of $95,000. The residual value of the equipment was estimated to be $5,000
Howarth Manufacturing Company purchased equipment on June 30, 2017, at a cost of $95,000. The residual value of the equipment was estimated to be $5,000 at the end of a five-year life. The equipment was sold on March 31, 2021, for $21,000. Howarth uses the straight-line depreciation method for all of its plant and equipment. Partial-year depreciation is calculated based on the number of months the asset is in service. Required: 1. Prepare the journal entry to record the sale. 2. Assuming that Howarth had instead used the double-declining-balance method, prepare the journal entry to record the sale.
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