Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Los Pollos Hermanos, Inc. purchased restaurant equipment on January 1, 2018 for $50,000, with an estimated useful life of 10 years and an estimated residual
Los Pollos Hermanos, Inc. purchased restaurant equipment on January 1, 2018 for $50,000, with an estimated useful life of 10 years and an estimated residual value of $5,000. Calculate and record depreciation expense for each of the methods below. Your final answer should include three separate journal entries. Clearly label your answers as A, B, and C. (You may free-form your response, or use the insert table feature to clearly identify the accounts and amounts being debited and credited.) A) Straight-line method: What is the journal entry that should be made to record depreciation expense for each full year of the asset's life? (5 points) B) Double-declining-balance method: What is the journal entry that would be made in the SECOND YEAR of the asset's life? (6 points) C) Units of Activity method: The company expects the equipment to be used for a total of 100,000 hours over the next 10 years, and the equipment is used for 13,000 hours this year. What is the journal entry that would be made at the end of this year to record depreciation expense? (5 points)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered 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