ZuoTi.Pro
Question

On June 28, 2019, Gundrum Inc. decided to dispose of its widget-making machine and found a...

On June 28, 2019, Gundrum Inc. decided to dispose of its widget-making machine and found a buyer willing to pay $15,000 for the machine. At January 1, 2019, the cost and accumulated depreciation of the widget-making machine was $1,000,000 and $900,000, respectively. The widget machine is depreciated over 20 years with no salvage value. Make all of the appropriate journal entries.

business   accounting   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1
Date Account title Debit credit
June 28,2019 Depreciation expense 24520.55
Accumulated depreciation-widget making machine 24520.55
June 28,2019 Cash 15000
Accumulated depreciation-widget making machine(900000+24520.55) 924520.55
loss on sale of widget making machinery 60479.45
Widget making machine 1,000,000

**

Depreciation =[cost-salvage value]/useful life

        =[1,000,000-0]/20

        = 1,000,000/20

        = 50000

Depreciation for 6months(1Jan -28June or 179 days )= 50000*6/12= 25000   or 50000*179/365= 24520.55

b)Book value =cost-accumulated depreciation

                     = 1000000-924520.55

                    = 75479.45

Loss on sale =15000-75479.45 = 60479.45

0 0
Add a comment
Know the answer?
Add Answer to:
On June 28, 2019, Gundrum Inc. decided to dispose of its widget-making machine and found a...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • Due Mon 11/18/20 Grey's Inc. decided to dispose of a piece of equipment and upgrade to a new model. They had purchas...

    Due Mon 11/18/20 Grey's Inc. decided to dispose of a piece of equipment and upgrade to a new model. They had purchased the old evaporator on January 1, 2012 for $13,700. There was no salvage/residual value and the useful life Grey's used was 6 years. Grey's depreciated the machinery using the Straight Line method. Grey's sold the equipment on June 30, 2016 to Tavon for $1550. a) Calculate the Book Value at time of sale.(Do not round the depreciation per...

  • Problem 2 On January 7, 2014 a company purchased a machine for $75,000 that was expected...

    Problem 2 On January 7, 2014 a company purchased a machine for $75,000 that was expected to last 5 years and to have a salvage value of $5,000. At the beginning of the machine's third year the company decided that the machine's estimated useful life should be revised to a total of 7 years instead of the original 5 years. Also, the salvage value was re-estimated to be $2,000. Straight-line depreciation will be used throughout the machine's life. 2a. Prepare...

  • On January 1, 2019, Betty DeRose, Inc. purchased a piece of machinery for $320,000. The machine...

    On January 1, 2019, Betty DeRose, Inc. purchased a piece of machinery for $320,000. The machine had an estimated useful life of 8 years and a salvage value of $5,000. Assume Betty DeRose depreciates its assets using the double declining balance method of depreciation. Calculate the amount of accumulated depreciation related to the machine that would appear in Betty's December 31, 2022 balance sheet.

  • Kookaburra Ltd used the cost model to measure its machine. Machine Z had cost of $80...

    Kookaburra Ltd used the cost model to measure its machine. Machine Z had cost of $80 000 and had a carrying amount of $70 000 at 30 June 2020 and is depreciated on a straight-line basis over a 10-year period. On 31 December 2020, the directors of Kookaburra Ltd decided to change the basis of measuring the equipment from the cost model to the revaluation model. Machine Z was revalued to $70 000 with an expected useful life of 8...

  • On January 2, 2020, Direct Shoes Inc. disposed of a machine that cost $94,000 and had...

    On January 2, 2020, Direct Shoes Inc. disposed of a machine that cost $94,000 and had been depreciated $50,250. Present the journal entries to record the disposal under each of the following unrelated assumptions: b. The machine was traded in on new tools having a $137,000 cash price. A $50,000 trade-in allowance was received, and the balance was paid in cash. Since the tools have been customized, the fair values are not known. Answer is complete but not entirely correct....

  • Brett Heart Co. maintains its accounts on the basis of a fiscal year ending June 30, 2018. On June 30, 2018, The Equipme...

    Brett Heart Co. maintains its accounts on the basis of a fiscal year ending June 30, 2018. On June 30, 2018, The Equipment account shows a debit balance of $224,000 which consists of a machine that was purchased on July 1, 2015 for $200,000 and a truck was purchased on 1/1/2018 (details below). The machine has a salvage value of 20,000 and the truck has a salvage value of $7,300. Both assets are being depreciated on a straight-line basis over...

  • Edgy Inc. acquired $250,000 in equipment in 2019 and wishes for you to calculate its depreciation...

    Edgy Inc. acquired $250,000 in equipment in 2019 and wishes for you to calculate its depreciation expense journal entry at the end year for years ending 12/31/2019; 12/31/2020; and 12/31/2021. Machine A was acquired on January 2, 2019 for $100,000. Useful life is five years. Machine B was acquired on June 30, 2019. Useful life is four years. What is the total depreciation expense for years 2019, 2020, and 2021 using Double Declining Balance: Sum-of-the-Digits: and Straight Line Depreciation.

  • Part B Bruce Manufacturing Ltd's post-closing trial balance at 30 June 2019 included the following balances:...

    Part B Bruce Manufacturing Ltd's post-closing trial balance at 30 June 2019 included the following balances: Machinery Control (at cost) $244 480 Accumulated Depreciation - Machinery Control 113 800 Fixtures (at cost) 308 600 Accumulated Depreciation - Fixtures 134 138 The Machinery Control and Accumulated Depreciation - Machinery Control accounts are supported by subsidiary ledgers. Details of machines owned at 30 June 2019 are as follows: Machine Purchase Cost Estimated Estimated date useful Life residual value 1 28 Apr 2015...

  • During 2019, Ryel Company's controller asked you to prepare correcting journal entries for the following three...

    During 2019, Ryel Company's controller asked you to prepare correcting journal entries for the following three situations 1. Machine A was purchased for 350,000 on January 1, 2014. Straight-line depreciation has been recorded for 5 years, and the Accumulated Depreciation account has a balance of $25,000. The estimated residual value remains at $5,000, but the service life is now estimated to be 1 year longer than estimated originally 2. Machine B was purchased for $40,000 on January 1, 2017. It...

  • Exercise 9-9 Your answer is partially correct. Try again Presented below are selected transactions at Skysong,...

    Exercise 9-9 Your answer is partially correct. Try again Presented below are selected transactions at Skysong, Inc. for 2019. Retired a piece of machinery that was purchased on January 1, 2009. The machine cost $60,000 on that date. It had a useful life of 10 years with no salvage value. Jan 1 Sold a computer that was purchased on January 1, 2016. The computer cost $36,600. It had a useful life of 5 years with no salvage value. The computer...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT