Sara Stone purchased new computer equipment costing $35,000 on 1 September 2021. The company also paid $500 for delivery and $500 for installation. The company paid $1,600 for an annual maintenance contract. The company expects the computer equipment to be used for 4 years, after which it will sell for about $4,000.

Narrations must be provided for all journals.

1. Calculate the cost of the computer equipment. Show your calculations.
2. Prepare the adjusting entry in the general journal for depreciation on 30 June 2022.
3. Prepare the adjusting entry in the general journal for depreciation on 30 June 2023.
4. Complete the extract of the Balance Sheet for Gerrys Guitar Store.

Part (i)

Part (ii)

Date	Details	Dr	Cr

Part (iii)

Date	Details	Dr	Cr

Part (iv)

Non-Current Assets	30 June 2022	30 June 2023
Computer Equipment
Less: Accumulated Depreciation
Carrying Value