Sullivan Sales purchased a machine on January 1, 2015 which cost $450,000. The m
ID: 2538192 • Letter: S
Question
Sullivan Sales purchased a machine on January 1, 2015 which cost $450,000. The machine had a residual value of $50,000 and a useful life of 10 years. Sullivan Sales can replace this machine with one that is more efficient and decides to sell the old machine for $100,000 on July 1, 2017.
Required:
Prepare the appropriate journal entry to record the sale of this machine, assuming the company uses the double-declining-balance method of depreciation. The fiscal year ends on December 31.
Depreciation Schedule:
Year
Book Value
Beginning of
Year
Rate
Annual
Depreciation
Accumulated
Depreciation
Book Value
Date
Account
Debit
Credit
Year
Book Value
Beginning of
Year
Rate
Annual
Depreciation
Accumulated
Depreciation
Book Value
Explanation / Answer
Depreciation schedule :
Beginning book value
Journal entry :
YearBeginning book value
Rate Annual dep Accumlated dep Ending book value 2015 450000 20% 90000 90000 360000 2016 360000 20% 72000 162000 288000 2017 288000 10% 28800 190800 259200Related Questions
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