Question
Hulme Company operates a small manufacturing facility as a supplement to its regular service activities. At the beginning of the current year, an asset account
Hulme Company operates a small manufacturing facility as a supplement to its regular service activities. At the beginning of the current year, an asset account for the company showed the following balances:
Manufacturing equipment | $ 147,000 |
---|---|
Accumulated depreciation through the end of last year | 69,000 |
During the current year, the following expenditures were incurred for the equipment:
Major overhaul of the equipment on January 2 the current year that improved efficiency | $ 6,000 |
---|---|
Routine repairs on the equipment | 1,600 |
The equipment is being depreciated on a straight-line basis over an estimated life of 20 years with a $19,000 estimated residual value. The annual accounting period ends on December 31.
Required:
Indicate the effects of the following on the accounting equation.
Note: Enter decreases to account categories as negative amounts and do not round your intermediate calculations.
- The adjustment for depreciation at the end of last year.
- The two expenditures during the current year for (a) the major overhaul of the equipment and (b) repairs and maintenance.
event | assets | liabalites | stockholders equity |
adjustment of depreciation | |||
adjustment of depreciation | |||
major overhual of equipment | |||
major overhual of equipment | |||
major overhual of equipment | |||
repairs and maintence | |||
repairs and maintence |
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