Question

5. Edgy Inc. acquired $250,000 in equipment in 2019 and wishes for you to calculate its depreciation expense journal entry at the end year for years ending 12/31/2019; 12/31/2020; and 12/31/2021.

Machine A was acquired on January 2, 2019 for $100,000. Useful life is five years.

Machine B was acquired on June 30, 2019. Useful life is four years.

A) What is the total depreciation expense for years 2019, 2020, and 2021 using Double Declining Balance: Sum-of-the-Digits: and Straight Line Depreciation.

6. From a company’s perspective explain the significance of the following events

A) Stock Splits

b) Stock Dividends

c) Cash Dividends

Answer 1

Depreciation. Expenne, as per Double Delling methad year. 2019 machine A = Rate of Depreciaks isxico 220% (CCASIS. Depreciation 2 100,000 X 2044X2 = 40,45o. year end Balance 360.000 (400 poo - uops) machine B- 4X10 ) 25% Depreciation 21. 150,000x25°40X23), 35,000 year end values. 150,000-7500 = zsaro Tatul Depreciation Experie of year.2019.2 yo poo tasvoo 2) 115oo. ---- ਤੇ ਕਦੇ ਦੇ। year 2020 machine A). 60,000 x 20.1.x2 = 24000 sopae year end values. 36000 B 75000 x 25%X2. = 39500 ean end values 3750o end ascoo - Bago) yeon Tatal Reprecial Expene ), o 2400 FASO 26180o.

year 2021 Machine. A z). 86000 x 200%.82 3). 14400 year end value Y 21600. Machine B 4.37 scox 951X2). 18750 year and values. 8750 (375w-18750) e4you Total Depreciation Etperie 2021 y 18750 tato 29 7 33150. NOPPPPPPAARRPPPPPPPPPP (Depreciation As pes Sum of Digit method.) year 2018. machine A Rake af Depreciation No y ureful year &qra има ед. Istuts & I year. I yeen a Il yeau I : V) /

machine AS. 18,000x. sy 33,333 machine B Rate of Depreciationd, no. cy weful year 2 ) Sumay ureful year Depreciation es. 1sgoud X 3 6001 6760UUUUUU Tabel Depreciation Expennens 60,00 +33333 93,333 year 2020) Machine H3 10900X 4 - 26662.. machine B2). 150,000x 3 2 Usooo ! Tatal Expene is 26667f4Swo 2 71,667.

year 902) machine A3) 100,000 X 5. 20,000 Machine B3) Isopoox i 30,000 Total repreation Expense s 50,000 (Depreciation Under straight line method.) Depreciation is value of machinery Wieful life. year 2018 machine A 2 100,000 & roove machine Bas 15o,ovo e Sasuo Tatal Expense & Saso. 2010 year 20,000 3a see machine An machire By Tatal Effone S7500

11 year 2021) Depreciation on machine 33 20,000 machine B) 37500 Tatal Depreciation Expensers stsoo. ho

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