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QS $3-8($Algo$)$ Accumulated depreciation calculations and adjustments LO P$1$

For each separate case below, follow the three$-$step process for adjusting the Accumulated Depreciation account at December $31.$

Step $1$: Determine what the current account balance equals.

Step $2$: Determine what.the current account balance should equal.

Step $3$: Record the December $31$ adjusting entry to get from step $1$ to step $2.$

Assume no other adjusting entries are made during the year.

$\backslash$table$[[$Step $1$: Determine what the current account balance equals.,$$,17,000,\backslash$table$[[$Debit or Credit?$],[$Credit$]],$Accumulated depreciation$],[17,000],[$Step $2$: Determine what the current account balance should equal.,$$,1,800,$Credit,$1,800],[$Step $3$: Record the December $31$ adjusting entry to get from step $1$ to step $2.,,],[$Adjusting Entry,,,Credit,$],[,,,,],[,,,,]]$

b$.$ Accumulated Depreciation: The company has only one plant asset $($truck$)$ that it purchased at the start of this year. That asset had cost $$51,000,$ had an estimated life of five years, and is expected to have zero value at the end of the five years. The company uses straight line depreciation method to calculate its depreciation.

$\backslash$table$[[,,],[,$Accumulated dedreciation,$]]$

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Exercise $3-1($Algo$)$ Determining assets and expenses for accrual and cash accounting LO C$1$

On July $1,$ Year $1,$ a company paid an $$17,100$ premium on a $36-$month insurance policy for coverage beginning on that date. Refer to that policy and fill in the blanks in the following table.

$\backslash$table$[[$Balance Sheet,Income Statement$],[$Prepaid Insurance,Insurance Expense$],[,$Accrual Basis,Cash Basis,,Accrual Basis,Cash Basis$],[$December $31,$ Year $1,,,$Year $1,,],[$December $31,$ Year $2,,,$Year $2,,],[$December $31,$ Year $3,,,$Year $3,,],[$December $31,$ Year $4,,,$Year $4,,],[,,$Total,,$]]$

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