Question

I'm struggling understanding the expenses. Can you please assist and explain?

Required information The following information applies to the questions displayed below) Onslow Co. purchased a used machine for $192,000 cash on January 2. On January 3, Onslow paid $8,000 to wire electricity to the machine and an additional $1,600 to secure it in place. The machine will be used for six years and have a $23,040 salvage value. Straight-line depreciation is used. On December 31, at the end of its fifth year in operations, it is disposed of. Prepare journal entries to record depreciation of the machine at December 31. View transaction list Journal entry worksheet Record the first year year-end adjusting entry for the depreciation expense of the used machine. Note: Enter debits before credits General Journal Debit Credit Dec 31 Clear entry View general journal Record entry

Answer 1

Depreciation each year under the straight line method = (Cost + Additional expenses - Salvage value) / Estimated useful life

= ($192,000 + $8,000 + $1,600 - $23,040) / 6

= $29,760

1.

Date	General Journal	Debit	Credit
Dec. 31	Depreciation expense	$29,760
	Accumulated depreciation		$29,760

2.

Date	General Journal	Debit	Credit
Dec. 31	Depreciation expense	$29,760
	Accumulated depreciation		$29,760