Question

How to calculate the depreciation in case 2 and case 3 ?

Zephyr Minerals completed the following transactions involving machinery Machine No. 1550 was purchased for cash on April 1, 2017, at an installed cost of $87.000. Its useful life was estimated to be sox years with a $6,000 trade-in value. Straight-line depreciation was recorded for the machine at the ends of 2017, 2018, and 2019. On March 29. 2020, it was traded for Machine No. 1795, with an instaled cash price of $81,000. A trade-in allowance of $32,110 was received for Machine No. 1550, and the balance was paid in cash. The fair values of Machine No. 1550 and Machine No. 1795 could not be determined Machine No. 1795's life was predicted to be four years with a trade-in value of $10,100 Double declining-balance depreciation on this machine was recorded each December 31 On October 2.2021. t was traded for Machine No BT 311. which had an installed Cash price of $722,000, the machine's fair value. A trade-in alowance of $10,000 was received for Machine No. 1795, and the balance was pad in cash It was estimated that Machine No. BT-311 would produce 200,000 units of product dunng its five year usetul life, after which it would have a $20,000 trade-in value Units of-production depreciation was recorded for the machine for 2021, a period in which it produced 43,000 units of product. Between January 1, 2022, arnd August 21, 2024, the machine produced 118,000 more units On August 21, 2024, it was sold for $83,100 Required: Prepare journal entries to record: (Round intermediate calculations to the nearest whole dollar) a. The depreciation expense recorded to the nearest whole month on the first December 31 of each machine's life (Round the final answers to no entry is required for a transaction, select "No journal entry required" in the first account field) nal answers to the nearest whole dollar. If

Answer 1

Information
Date	Particulars	UoM
1-Apr-17	Machine no 1550	USD	87000
	Useful life	years	6
	Salvage value	USD	6000
	Method		SLM
	Sold at	USD	32110
29-Mar-20	Machine no 1795	USD	81000
	Useful life	years	4
	Salvage value	USD	10100
	Method		Double declining
	Sold at		10000
2-Oct-21	Machine no 311	USD	722000
	Production no of units	nos	200000
	Useful life	years	5
	Salvage value	USD	20000
	Produced in 2021	nos	43000
1-jan-21 to 21-aug-24	Produced	nos	118000
21-Aug-24	Sold at	USD	83100
Journal entries
Date	Particulars	Debit	Credit
1-Apr-17	Machine no 1550	87,000
	To Cash		87,000
31-Dec-17	Depreciation	10,171
	To Accumulated depreciation		10,171
31-Dec-18	Depreciation	13,500
	To Accumulated depreciation		13,500
31-Dec-19	Depreciation	13,500
	To Accumulated depreciation		13,500
29-Mar-20	Vendor	32,110
	Accumulated depreciation	37,171
	Loss on sale	17,719
	To Machine no 1550		87,000
29-Mar-20	Machine no 1795	81,000
	To Vendor		81,000
29-Mar-20	Vendor	48,890
	To Cash		48,890
31-Dec-20	Depreciation	30,736
	To accumulated depreciation		30,736
2-Oct-21	Depreciation	22,613
	To accumulated depreciation		22,613
2-Oct-21	Vendor	10,000
	Accumulated depreciation	53,349
	Loss on sale	17,651
	To Machinery 1795		81,000
2-Oct-21	Machine BT 311	722,000
	To Vendor		722,000
2-Oct-21	Vendor	712,000
	To Cash		712,000
31-Dec-21	Depreciation	153,080
	To accumulated depreciation		153,080
	( Depreciation for 43000 units)
31-Dec-22	Depreciation	159,055
	To accumulated depreciation		159,055
	( For pro rata of 118000 units based on no of days)
31-Dec-23	Depreciation	159,055
	To accumulated depreciation		159,055
	( For pro rata of 118000 units based on no of days)
21-Aug-24	Depreciation	101,970
	To accumulated depreciation		101970
	( For pro rata of 118000 units based on no of days)
21-Aug-24	Cash	83,100
	Accumulated depreciation	573,160
	Loss on sale	65,740
	To Machine BT 311		722000