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Equipment1 was purchased at the beginning of the year 2016 for $50,000 cash. No salvage/residual value....

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Accounting

Equipment1 was purchased at the beginning of the year 2016 for$50,000 cash. No salvage/residual value. Straight-line depreciationis used over a 10-year life.

Equipment2 was also purchased at the beginning of the year for550,000 (no salvage) 10 year life. We decided to use SL method. Theequipment2 required a $5,000 repair by year-end.

Equipment3 was purchased on 6/1 for 100,000 (20,000 salvagevalue)., 10 year life. We decided to use SYD as a depreciationmethod. At 12/31/2016 it required a capital improvements of $40,000which we signed a note to pay in 9 months.

Prepare Journal entries for all transactions

Answer & Explanation Solved by verified expert
4.4 Ratings (551 Votes)
Solution Journal Date Journal Debit Credit 112016 Equipment 1 50000 To cash 50000 Being equipment 1 purchases for cash 112016 Equipment 2 550000 To cash 550000 Being equipment 2 purchases for cash 612016 Equipment 3 100000 To    See Answer
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