Question

Wardell Company purchased a mainframe on January 1, 2019, at a cost of $44,000. The computer was depreciated using the straight-line method over an estimated five-year life with an estimated residual value of $5,000. On January 1, 2021, the estimate of useful life was changed to a total of 10 years, and the estimate of residual value was changed to $800.

Required:
1. Prepare the year-end journal entry for depreciation in 2021. No depreciation was recorded during the year. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your final answer to nearest whole dollar.)

2. Prepare the year-end journal entry for depreciation in 2021. Assume that the company uses the sum-of-the-years' -digits method instead of the straight-line method. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations. Round your final answers to nearest whole dollar.)

Answer 1

Sausing 44000 original cost -Accumulated depreciation (muco -5000 x j 15600 Net boots value on Jan 1, 2011 28tpoo Revised Sivage vake 800 Buds vellve to be depreciated 27600 Revised useful life Go-2.) Depreciation expense 3450 General Journal Debit credit Depreciation expenses 3450 Accumulated Depreciation 3450

Original cost .. կկÛԾԾ 13000 Accumulated depreciation (44000-000x15) 10400 Accumulated depreciation ru4000-5000 x 15 X15) Net book value on juis 2001 : 20600 Revised Salvage Value Suo Rods value to be depreciated 10800 Rensed ureful life (10-2) Depreciation expense 19800x8 ... 4400 36 General Journal .. Debt Credit Lyo0 Depre Cicetion expense Accumulated deprecizetilin uyoo