On January 1, a company purchased equipment that cost $10,000. The company has not yet recorded depreciation, which is estimated at $1,800 per year. The company will prepare financial statements at the end of January. Complete the necessary journal entry. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Homework Answers
**THE DEPRECIATION ENTRY IS MADE ONLY AFTER THE YEAR IS COMPLETE , IT IS MADE IN PROPORTIONS TO MONTHS ONLY WHEN THE ASSET IS BEING SOLD AT ANY TIME OF THE YEAR. SO, IN THE ABOVE CASE THE COMPANY WILL MAKE DEPRECIATION ADJUSTING ENTRY AT THE YEAR END .IT WILL RECORD THE DEPRECIATION EXPENSE IN THE ACCUMULATED DEPRECIATION ACCOUNT SO THAT THE NET VALUE CAN BE ADJUSTED IN THE BALANCE SHEET .
ENTRY TO BE MADE :
DEPRECIATION A/C DR. 1800
TO ACCUMULATED DEPRECIATION A/C 1800
(BEING DEPRECIATION IS ADJUSTED )
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required for a transaction/event, select "No journal entry
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