Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Sumon Enterprise purchased a factory machine at a cost of Tk. 17,000 on January 1, 2020. Its set-up cost was Tk. 1,000. It expected the

Sumon Enterprise purchased a factory machine at a cost of Tk. 17,000 on January 1, 2020. Its set-up cost was Tk. 1,000. It expected the machine to have a salvage value of Tk. 2,000 at the end of its 4-year useful life. Sumon applied the double-declining balance method. The enterprises accounting period ends on 31 December each year.

Required:

a) Prepare depreciation schedule for 4-year useful life using double the straight-line rate. For doing this, you need to calculate the declining balance rate first.

b) Prepare the journal entries to record depreciation and disposal assuming that the machine was sold for Tk. 2,000 on 31 December, 2022. No explanation is required for the journal entries.

c) Depreciation, depletion and amortization expense are same. Evaluate the statement critically.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting Texts And Cases

Authors: Robert Anthony, David Hawkins, Kenneth A. Merchant

12th Edition

0073100919, 978-0073100913

More Books

Students also viewed these Accounting questions