Question

deprectiation

Che The property.plant, and equipment section of the Jasper Company's December 31, 2017, balance sheet contained the following: $116,660 Property, plant, and equipment: Land Building Less: Accumulated depreciation Equipment Less: Accumulated depreciation Total property, plant, and equipment $936,089 (180,000) 163,000 756,00 The land and building were purchased at the beginning of 2013. Straight-line depreciation is used and a residual value of $36,000 for the building is anticipated. The equipment is comprised of the following three machines: Life in Years Machine 101 102 103 Cost $53,800 85,000 24,200 Date Acquired 1/1/15 6/30/16 9/1/17 Residual Value $ 6,600 7,600 2,600 The straight-line method is used to determine depreciation on the equipment. On March 31, 2018, Machine 102 was sold for $59.000 Farly in 2018 the useful life of machine 101 was revised to five vears in total and the residual value was revised to zero

Answer 1

							A		B	(A*B)
	Machine	Cost	Date Acquired	Residual value	Life in Years	Reporting date	Depreciation per month		Life expired(months)	Accumulated depreciation	Book value	Depreciation for 2018
	101	53800	01/01/2015	$6,600	8	12/31/2017	491.67	(53800-6600)/(8*12)	36	$17,700	$36,100	$18,050	(36,100/2)
	102	85000	06/30/2016	$7,600	9	12/31/2017	716.67	(85000-7600)/(9*12)	18	$12,900	$72,100
	103	24200	09/01/2017	$2,600	8	12/31/2017	225.00	(24200-2600)/(8*12)	4	$900	$23,300	2,700.00	(225*12)
										$31,500		$20,750
			Hence accumulated Depreciation =			$31,500
Requirement-2	Depreciation - Machine 102	$2,150		(716.67*3)
	Accumulated depreciation- machine 102		$2,150	(716.67*3)
	(Depreciaiton charged for 3 months)
Requirement -3	Cost of machine	85000
	Accumulated depreciation	$15,050	(12,900+2,150)
	Book value	$69,950
	Sale price	$59,000
	Loss on sale of machine	$10,950
Requirement -4	Cash	$59,000
	Accumulated depreciation-machine 102	$15,050
	Loss on sale of machine	$10,950
	Equipment- machine 02		$85,000
	(sale recorded)
Requirement-5	Depreciation - building	$36,000		Accumulated depreciation for 5 years = 180,000, per year depreciation = 36,000
	Depreciation - equipment	$20,750
	Accumulated depreciation - Building		$36,000
	Accumulated depreciation - equipment		$20,750