McCartney Manufacturing purchased a dryer for $100,000 on January 1, 2014. The estimated life of the dryer is five...
McCartney Manufacturing purchased a dryer for $100,000 on January 1, 2014. The estimated life of the dryer is five years, and the salvage value is estimated to be $10,000. McCartney uses the straight-line method of depreciation.
On January 1, 2018, McCartney paid $160,000 to have the dryer overhauled, which increased the speed of the dryer and extended its estimated useful life to December 31, 2021. Each year, McCartney pays $1,000 to have the dryer serviced. On November 12, 2018, a major repair was required at a cost of $5,000. Salvage value is still estimated to be $10,000.
REQUIRED:
a. Provide the journal entry on January 1, 2014, to record the purchase of the dryer.
b. How should the service and repair costs be treated on McCartney's books?
c. Compute the depreciation expense that would be recognized during each year of the dryer's eight years of useful life.
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McCartney Manufacturing purchased a dryer for $100,000 on January 1, 2014. The estimated life of the dryer is five...
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On January 3, 2016, Bonita Industries purchased machinery. The machinery has an estimated useful life of...
On January 3, 2016, Bonita Industries purchased machinery. The
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estimated salvage value of $121000. The depreciation applicable to
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sum-of-the-years'-digits method. The acquisition cost of the
machinery was
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On January 3, 2016, Vaughn Manufacturing purchased machinery. The machinery has an estimated useful life of eight years and an estimated salvage value of $122000. The depreciation applicable to this machinery was $259000 for 2018, computed by the sum-of-the-years'-digits method. The acquisition cost of the machinery was O $1464000. O $1554000 $1676000. $1868000.
On January 1, 2014, Swifty Company purchased a building and equipment that have the following useful lives, salvage values, and costs. Building, 40-year estimated useful life, $48,400 salvage value, $750,400 cost Equipment, 12-year estimated useful life, $10,000 salvage value, $97,300 cost The building has been depreciated under the double-declining-balance method through 2017. In 2018, the company decided to switch to the straight-line method of depreciation. Swifty also decided to change the total useful life of the equipment to 9 years,...
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On January 3, 2016, Bonita Industries purchased machinery. The
machinery has an estimated useful life of eight years and an
estimated salvage value of $121000. The depreciation applicable to
this machinery was $269000 for 2018, computed by the
sum-of-the-years'-digits method. The acquisition cost of the
machinery was
$1452000.
$1735000.
$1614000.
$1927000.
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