Question

Wiater Company operates a small manufacturing facility. On January 1, 2018, an asset account for the company showed the following balances: Equipment Accumulated Depreciation (beginning of the year) $250,000 172250 During the first week of January 2018, the following expenditures were incurred for repairs and maintenance: 750 Routine maintenance and repairs on the equipment Major overhaul of the equipment that improved efficiency 33,000 The equipment is being depreciated on a straight-line basis over an estimated life of 20 years with a $19,000 estimated residual value. The annual accounting period ends on December 31. Required: 1. Prepare the adjusting journal entry that would have been made at the end of 2017 for depreciation on the manufacturing equipment. 2. Starting at the beginning of 2018, what is the remaining estimated life? 3. Prepare the journal entries to record the two expenditures for repairs and maintenance during 2018. Complete this question by entering your answers in the tabs below. Required Required Required Prepare the adjusting journal entry that would have been made at the end of 2017 for depreciation on the manufacturing equipment. (Do not round intermediate calculations. If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet Record the adjusting entry for depreciation expense at year-end 2017. Note: Enter debits before credits. Transaction General Journal Debit Credit Record entry Clear entry View general journal

Required Parts 1-3 Please!

Answer 1

a) Adjusting entry

date	account and explanation	Debit	Credit
2017	Depreciation expense (250000-19000/20)	11550
	Accumulated depreciation-equipment		11550

b) Used life = 173250/11550 = 15 Year

Remaining life = 20-15 = 5 years

c) Journal entry

Date	account and explanation	Debit	Credit
2018	Repairs and maintenance	2750
	Cash		2750
2018	Equipment	33000
	Cash		33000