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Murphy's Auto Co. purchased a large piece of equipment on January 1, 2004. The equipment is being depreciated, using the straight-line method, at the rate
Murphy's Auto Co. purchased a large piece of equipment on January 1, 2004. The equipment is being depreciated, using the straight-line method, at the rate of $14,000 per year with no salvage value. On January 1, 2015, after 2014's year end adjusting journal entires, the book value of the machine was $190,000. (a) What was the original cost of the machine? Describe how you arrived at your amount. (b) What will the book value be on January 1 st 2018 after 2017 adjusting journal entries are made? Describe how you arrived at you amount. (c) WHAT IS ADJUSTING JOUTNAL ENTRY FOR EACH YEAR (show one year only) FOR DEPRECIATION? use proper format for the entry by showing the debited and credited accounts
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