Instructions X Chart of Accounts ASSETS REVENUE 110 Cash 410 Sales New lithographic equipment, acquired at a cost of $772,800 on March 1 at the beginning of a fiscal year, has an estimated useful life of five years and an estimated residual value of 586,940. The manager requested information regarding the effect of alternative methods on the amount of depreciation expense each year. On the basis of the data presented to the manager, the double-declining-balance method was selected. 111 Petty Cash 610 Interest Revenue 112 Accounts Receivable 620 Gain on Sale of Delivery Truck 114 Interest Receivable 621 Gain on Sale of Equipment In the first week of the fifth year, on March 4, the equipment was sold for $130,585. 115 Notes Receivable 116 Merchandise Inventory EXPENSES Required: 510 Cost of Merchandise Sold 1. Determine the annual depreciation expense for each of the estimated five years of use, the 117 Supplies 119 Prepaid Insurance 520 Salaries Expense accumulated depreciation at the end of each year, and the book value of the equipment at the end of each year by (a) the straight-line method and (b) the double-declining-balance method. Round your 120 Land 521 Advertising Expense answers to the nearest whole dollar. 123 Delivery Truck 522 Depreciation Expense-Delivery Truck 2. Journalize the entry to record the sale assuming the manager chose the double-declining-balance 124 Accumulated Depreciation-Delivery Truck 523 Delivery Expense method. 125 Equipment 3. Journalize the entry to record the sale in (2), assuming that the equipment was sold for $87,105 instead of $130,585. Refer to the Chart of Accounts for exact wording of account titles. 524 Repairs and Maintenance Expense 126 Accumulated Depreciation- Equipment 529 Selling Expenses 130 Mineral Rights 531 Rent Expense 131 Accumulated Depletion 532 Depreciation Expense- 132 Goodwill Equipment 133 Patents 533 Depletion Expense 534 Amortization Expense-Patents LIABILITIES 535 Insurance Expense 210 Accounts Payable 536 Supplies Expense 211 Salaries Payable 539 Miscellaneous Expense Starting questions x Determine the annual depreciation expense for each of the estimated five years of use the accumulated depreciation at the end of each year, and the book value of the equipment at the end of each year by (a) the straight-line method and (b) the double-declining-balance method. Round your answers to the nearest whole dollar. a. Straight-line method Accumulated Depreciation, End of Year Year Depreciation Expense Book Value, End of Year 1 S A S 2 3 4 5 b. Double-declining-balance method Accumulated Depreciation, End of Year Year Depreciation Expense Book Value, End of Year 1 $ $ 2. 3 4 5 Journal 2. On March 4, journalize the entry to record the sale assuming the manager chose the double-declining-balance method. Refer to the Chart of Accounts for exact wording of account titles. PAGE 1 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 2 3 4 3. On March 4, journalize the entry to record the sale in (2), assuming that the equipment was sold for $87,105 instead of $130,585. Refer to the Chart of Accounts for exact wording of account titles PAGE 1 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST, REF DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 2 3 4