E6-10 (modified)
Exact Photo Service purchase a new color printer at the beginning of 2019 for $28,000. The printer is expected to have a four-year useful life and a $3,500 salvage value. The expected print production is estimated at 1,500,000 pages. Actual print production for the four years was as follows:
Year |
Pages Printed |
2018 |
390,000 |
2019 |
410,000 |
2020 |
400,000 |
2021 |
300,000 |
The printer was sold at the end of 2021 for $1,650.
Event |
Assets |
Liab |
Equity |
Rev |
Exp |
Net Inc. |
Cash Flow |
||
Cash |
Printer |
Accum. Depr. |
|||||||
Straight-line Method |
|||||||||
2021 Depreciation |
|||||||||
Sale of Printer |
|||||||||
Units-of-production Method |
|||||||||
2021 Depreciation |
|||||||||
Sale of Printer |
Straight line Depreciation = (Original Value - Salvage Value) /
Useful life
= ($28000-3500)/4 = $6125 per year
Year | Depreciation Expense | Accumulated Depreciation | Book Value |
2018 | $ 6,125 | $ 6,125 | $ 21,875 |
2019 | $ 6,125 | $ 12,250 | $ 15,750 |
2020 | $ 6,125 | $ 18,375 | $ 9,625 |
2021 | $ 6,125 | $ 24,500 | $ 3,500 |
Total | $ 24,500 |
Units of Production Method = (Original Value - Salvage Value) /
Total Capacity
= ($28000-3500)/1500000 per page
Year | Pages Printed | Depreciation Expense | Accumulated Depreciation | Book Value |
2018 | 390000 | $ 6,370 | $ 6,370 | $ 21,630 |
2019 | 410000 | $ 6,697 | $ 13,067 | $ 14,933 |
2020 | 400000 | $ 6,533 | $ 19,600 | $ 8,400 |
2021 | 300000 | $ 4,900 | $ 24,500 | $ 3,500 |
Total | 1500000 | $ 24,500 |
Book Value at end of 2021 = $3500
Loss from sale of asset = $3500-1650 = $1850
Straight line
Cash | Printer | Acc Dep | Equity | Rev | Exp | Net Income | |
2021 Dep | $ 6,125 | $ -6,125 | $ 6,125 | $ -6,125 | |||
Sale | $ 1,650 | $ -28,000 | $ -24,500 | $ -1,850 | $ 1,850 | $ -1,850 |
Units of Production
Cash | Printer | Acc Dep | Equity | Rev | Exp | Net Income | |
2021 Dep | $ 4,900 | $ -4,900 | $ 4,900 | $ -4,900 | |||
Sale | $ 1,650 | $ -28,000 | $ -24,500 | $ -1,850 | $ 1,850 | $ -1,850 |
E6-10 (modified) Exact Photo Service purchase a new color printer at the beginning of 2019 for...
Exact Photo Service purchased a new color printer at the beginning of 2018 for $38,000. The printer is expected to have a four-year useful life and a $3,500 salvage value. The expected print production is estimated at 1,500,000 pages. Actual print production for the four years was as follows: 2018 390,000 2019 410,000 2020 420,000 2021 300,000 Total 1,520,000 The printer was sold at the end of 2021 for $1,650. A) Compute the depreciation expense for each of the four...
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Required information [The following information applies to the questions displayed below.] Exact Photo Service purchased a new color printer at the beginning of 2018 for $38,000. The printer is expected to have a four-year useful life and a $3,500 salvage value. The expected print production is estimated at 1,500,000 pages. Actual print production for the four years was as follows: 2018 390,000 2019 410,000 2020 420,000 2021 300,000 Total 1,520,000 The printer was sold at the end of 2021 for...
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Save & Exit Help Su Saved Required information [The following information applies to the questions displayed below Exact Photo Service purchased a new color printer at the beginning of 2018 for $38,800. The printer is expected to have a four-year useful life and a $1,552 salvage value. The expected print production is estimated at 1,500,000 pages. Actual print production for the four years was as follows: 2018 551,100 483,000 383, 300 386,100 2019 2020 2021 1,803,...