Question

n QS 3-9 Adjusting for depreciation LO P1 Barga Company purchases $20,000 of equipment on January 1. The equipment is expected to last five years and be worth $2.000 at the end of that time. Prepare the entry to record one year's depreciation expense for the equipment as of December 31. (if no entry is required for a transaction event, select "No journal entry required in the first account field.) ped View transaction list Journal entry worksheet Record the depreciation adjustment on equipment on December 31, if any. Note: Enter debits before credits Transaction General Journal Debit Credit Record entry Clear entry View general journal

Answer 1

3.

Cost of equipment = $20,000

Residual value = $2,000

Useful life = 5 years

Annual depreciation = ( Cost of equipment - Residual value)/Useful life

= ( 20,000-2,000)/5

= $3,600

Date	General Journal	Debit	Credit
a.	Depreciation expense	$3,600
	Accumulated depreciation- Equipment		$3,600
	( To record depreciation on equipment)

4.

Salaries expense on December 31 = Number of employees x Salary per employees per day x Number of days

= 5 x 250 x 1

= $1,250

Date	General Journal	Debit	Credit
December 31	Salaries expense	$1,250
	Salaries payable		$1,250
	( To record adjusting entry of employees wages)
January 04	Salaries payable	$1,250
	Salaries expense	$3,750
	Cash		$5,000
	( To record payment of the employees wages)

Salaries expense on January 04 = Number of employees x Salary per employees per day x Number of days

= 5 x 250 x 3

= $3,750

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