QS 3-8 Accumulated depreciation adjustments LO P1 For each separate case below, follow the three-step process for adjusting the Accumulated Depreciation account at December 31 Step 1: Determine what the current account balance equals. Step 2: Determine what the current account balance should equal Step 3: Record the December 31 adjusting entry to get from step 1 to step 2. Assume no other adjusting entries are made during the year a. The Krug Company's Accumulated Depreciation account has a $18,500 balance to start the year. A review of depreciation schedules reveals that $20,600 of depreciation expense must be recorded for the year. Accumulated depreciation Step 1: Determine what the current account balance equals. Step 2: Determine what the current account balance should equal Step 3: Record the December 31 adjusting entry to get from step 1 to step 2. Debit Credit b. The company has only one fixed asset truck) that it purchased at the start of this year. That asset had cost $54,000, had an estimated life of 5 years, and is expected to have zero value at the end of the 5 years, Accumulated depreciation Step 1: Determine what the current account balance equals Step 2: Determine what the current account balance should equal Step 3: Record the December 31 adjusting entry to get from step 1 to step 2. b. The company has only one fixed asset (truck) that it purchased at the start of this year. That asset had cost $54,000, had an estimated life of 5 years, and is expected to have zero value at the end of the 5 years. 10 Accumulated depreciation -Truck Step 1: Determine what the current account balance equals. Step 2: Determine what the current account balance should equal to Step 3: Record the December 31 adjusting entry to get from step 1 to step 2 c. The company has only one fixed asset (equipment) that it purchased at the start of this year. That asset had cost $52,000, had an estimated life of 7 years, and is expected to be valued at $10,000 at the end of the 7 years Accumulated depreciation Equipment Step 1: Determine what the current account balance equals Step 2: Determine what the current account balance should equal Step 3: Record the December 31 adjusting entry to get from step 1 to step 2