[As HOMEWORKLIB’s policy and guideline, the first-question with all parts is answered below:]
Q3)
a.
SL depreciation = (Cost – Residual value) / Life years
= ($125,000 - $5,000) / 5
= $120,000 / 5
= $24,000 (Answer)
b.
DB rate = SL rate × 2
= [(1/Life years) × 100] × 2
= [(1/5) × 100] × 2
= 20% × 2
= 40% (Answer)
c.
DB depreciations (every year):
Year 1 = Cost × DB rate = $125,000 × 40% = $50,000 (Answer)
Year 2 = (Cost – 50,000) × DB rate = ($125,000 – 50,000) × 40% = $75,000 × 40% = $30,000 (Answer)
Year 3 = (Cost – 50,000 – 30,000) × DB rate = ($125,000 – 80,000) × 40% = $45,000 × 40% = $18,000 (Answer)
Year 4 = (Cost – 50,000 – 30,000 – 18,000) × DB rate = ($125,000 – 98,000) × 40% = $27,000 × 40% = $10,800 (Answer)
Year 5 = (Cost – 50,000 – 30,000 – 18,000 – 10,800) × DB rate = ($125,000 – 108,800) × 40% = $16,200 × 40% = $6,480. But the residual value of $5,000 is to be maintained in the last year. Therefore, the depreciation is ($16,200 - $5,000 =) $11,200 (Answer)
d.
Journal entry
Date |
Account titles & explanation |
P.ref |
Debit $ |
Credit $ |
End of year 1 |
Depreciation expense |
50,000 |
||
Accumulated depreciation |
50,000 |
|||
To record charging depreciation of equipment at the year-end. |
4 After the accounts have been adjusted at July 31, the end of the fiscal year,...
Number 4
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journal after the accounts have been adjusted at December 31, the end of the fiscal year, the following balances were taken from the ledger of Pioneer Delivery Services Co. Kerry Buckner, capital. 9,556,300 Kerry Buckner, drawing. 80,000 Fees earned 1,878,400 Wages expense. 1,415,500 Rent expense. 125,000 Supplies Expense 30,000 Miscellaneous expense. 22,100
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Closing Entries
After the accounts have been adjusted at November 30, the end of
the fiscal year, the following balances were taken from the ledger
of Diamond Landscaping Co.:
Retained Earnings
$2,550,000
Dividends
25,000
Fees Earned
1,150,000
Wages Expense
613,750
Rent Expense
120,000
Supplies Expense
9,150
Miscellaneous Expense
11,000
Journalize the two entries required to close the accounts. If an
amount box does not require an entry, leave it blank.
Closing Entries After the accounts have been adjusted at November...
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