Calculating and Journalizing Depreciation 1. Calculate the depreciation expense

Question

Calculating and Journalizing Depreciation 1. Calculate the depreciation expense for Johnson Machine as of December 31, 20--. 2. Prepare the entry for depreciation expense using a general journal. If an amount box does not require an entry, leave it blank Equipment records for Johnson Machine Co. for the year follow. Johnson Machine uses the straight-line method of depreciation. In the case of assets acquired by the fifteenth day of the month, depreciation should be computed for the entire month. In the case of assets acquired after he fifteenth day of the month, no depreciation should be considered for the month in which the asset was acquired Purchase Price $20,000 24,000 18,000 14,000 40,000 Salvage Date Asset Useful Life Value Purchased Truck #1 Truck #2 Tractor #1 Tractor #2 Forklift 8 years $4,000 January 1 4,000 April 10 3,000 May 1 2,000 June 18 4,000 Stber 1 10

Explanation / Answer

1. Calaculation of Depreciation Exp Debited to Profit and Loss A/c

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2. Journal Entries for Deprecaition

Date 31.12.20XX

Assets Purchases Price(A) Use ful life (Years)(B) Salvage Value ( C ) Amount To be Deprecaited over the useful life of Assets (D)= (A-C) No of month required to deprecaite(E) Year Depreciation Amount (F)= D/B Depreciation Amount = F/12*E Truck 1 20000 8 4000 16000 12 2000 2000.00 Truck 2 24000 8 4000 20000 12 2500 2500.00 Tractor 1 18000 5 3000 15000 11 3000 2750.00 Tractor 2 14000 6 2000 12000 9 2000 1500.00 Forkift 40000 10 4000 36000 4 3600 1200.00 Depreciation

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