Question

Please help with a,b, and c. i need them all. thank you.

Ch 10-3 Exercises & Problems Entries for Sale of Fixed Asset Equipment acquired on January 8 at a cost of $156,160, has an estimated useful life of 16 years, has an estimated residual value of $8,000, and is depreciated by the straight-line method. a. What was the book value of the equipment at December 31 the end of the fourth year? $ 9,260 b. Assuming that the equipment was sold on April 1 of the fifth year for 111,390. 1. Journalize the entry to record depreciation for the three months until the sale date. Round your answers to the nerest whole dollar if required. Depreciation Expense-Equipment 2,315 Accumulated Depreciation Equipment 2,315 2. Joumalize the entry to record the sale of the equipment. If an amount box does not require an entry, leave it blank. Do not round intermediate calculations. Cash Accumulated Depreciation-Equipment Loss on Sale of Equipment Equipment Check My Work 2 more Check My Work uses remaining

Answer 1

In the image shared I find only questions a and b (1 and 2). There is no question c. Below are the answers:

Answer (a):

Annual depreciation = (Cost - Residual value) / Useful life = (156160 - 8000) / 16 = $9,260

At the end of fourth year accumulated depreciation = 9260 * 4 = $37040

Book value of equipment at Dec. 31,the end of fourth year = Cost - accumulated depreciation

= 156160 - 37040

= $119,120

119,120

Answer (b):

Equipment was sold on Apr 1 of the fifth year for = $111,390

(1)

Depreciation for 3 months = 9260 * 3/12 = $2,315

$2,315 Depreciation Expense - Equipment Accumulated Depreciation - Equipment $2,315

(2)

Accumulated depreciation on Apr 1, fifth year = 37040 + 2315 = $39,355

Book value of Apr 1, fifth year = 156160 - 39355 = $116,805

Loss on sale = 116805 - 111390 =$5415

Journal Entry:

$111,390 Cash Accumulated Depreciation - Equipment $39,355 Loss on sale of equipment $5,415 Equipment $156,160