Partial-Year Depreciation

Equipment acquired at a cost of $87,000 has an estimated residual value of $5,000 and an estimated useful life of 10 years. It was placed into service on October 1 of the current fiscal year, which ends on December 31.

If necessary, round your answers to the nearest cent.

a. Determine the depreciation for the current fiscal year and for the following fiscal year by the straight-line method.

	Depreciation
Year 1	$fill in the blank 1
Year 2	$fill in the blank 2

b. Determine the depreciation for the current fiscal year and for the following fiscal year by the double-declining-balance method.

	Depreciation
Year 1	$fill in the blank 3
Year 2	$fill in the blank 4

Disposal of Fixed Asset

Equipment acquired on January 6 at a cost of $364,300 has an estimated useful life of 8 years and an estimated residual value of $47,500.

a. What was the annual amount of depreciation for Years 1-3 using the straight-line method of depreciation?

Year	Depreciation Expense
Year 1	$fill in the blank e0cd48010fd9f82_1
Year 2	$fill in the blank e0cd48010fd9f82_2
Year 3	$fill in the blank e0cd48010fd9f82_3

b. What was the book value of the equipment on January 1 of Year 4? $fill in the blank e0cd48010fd9f82_4

c. Assuming that the equipment was sold on January 3 of Year 4 for $233,200, journalize the entry to record the sale. If an amount box does not require an entry, leave it blank.

d. Assuming that the equipment had been sold on January 3 of Year 4 for $250,400 instead of $233,200, journalize the entry to record the sale. If an amount box does not require an entry, leave it blank.