The equipment has an estimated useful life of 7 years. Record Depreciation for one month. The...
The equipment has an estimated useful life of 7 years. Record Depreciation for one month. The Equipment was bought for 21,420 dollars on June 4. Adjusting entry for June 30. Do straight line.
Homework Answers
Calculation of Straight line Depreciation on Equipment:-
Depreciation=(Cost of Equipment÷Useful Life of Equipment)
=$(21,420÷7)
=$3,060
Above calculated depreciation is annual Depreciation, its for 12 months or 365 Days,but we need to calculate depreciation for June month (from June 4 to June 30).So the Calculation is:-
Depreciation for June=$(3,060÷12)
=$255
For June month Depreciation is $255, but Equipment was bought on June 4 ,so the depreciation is Calculating for 27days (June 4 to June 30):-
Depreciation for 27days=$(255×27/30)
=$229.50
Journal Entry of Depreciation for June:-
| Date | Description | Amount (Debit) | Amount(credit) |
|---|---|---|---|
| June 30 | Depreciation Expense | 229.50 | |
| To Accumulated Depreciation | 229.50 | ||
| For the depreciation from June 4 to June 30. |
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