Question

oE0OK Show Me How Calculator Print Hem Disposal of Fixed Asset Equipment acquired on January 6 at a cost of $375,000 has an estimated useful life of 20 years and an estimated residual value of $25,000 a. What was the annual amount of depreciation for the Years 1-3 using the straight-line method of depreciation? Year Depreciation Expense Year 1 Year 2 Year 3 b. What was the book value of the equipment on January 1 of Year 4? C. Assuming that the equipment was sold on January 3 of Year 4 for $3000,000 journalize the entry to record the sale If an amount box does not require an entry, leave it blank. Jan. 3 d. Assuming that the equipment had been sold on Januiary 3 of Year 4 for s325 000stead of $300,000, journalize the entry to record the sale. If an amount box does not require an entry leave it blank Check My Work 3 more Check MY Wenk usesremRining Previous Next

can you help me solve this please

Answer 1

a	Straight-line method
	Year	Depreciation Exp.
	1	$17,500
	2	$17,500
	3	$17,500
	Depreciation per year = ($375,000 - $25,000)/20 = $17,500
b	Book Value $322,500 ($375,000 - $52,500)
c
	Date	General Journal	Debit	Credit
	Jan 03	Cash	$300,000
		Accumulated Depreciation	$52,500
		Loss on Sale of Equipment	$22,500
		Equipment		$375,000
d
	Date	General Journal	Debit	Credit
	Jan 03	Cash	$325,000
		Accumulated Depreciation	$52,500
		Gain on Sale of Equipment		$2,500
		Equipment		$375,000