1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Nadya [2.5K]
3 years ago
11

Exercise 8-17 Partial-year depreciation; disposal of plant asset LO P2 Rayya Co. purchases and installs a machine on January 1,

2018, at a total cost of $105,000. Straight-line depreciation is taken each year for four years assuming a seven-year life and no salvage value. The machine is disposed of on July 1, 2022, during its fifth year of service. Prepare entries to record the partial year’s depreciation on July 1, 2022 and to record the disposal under the following separate assumptions: (1) The machine is sold for $45,500 cash. (2) An insurance settlement of $25,000 is received due to the machine’s total destruction in a fire.
Business
1 answer:
Citrus2011 [14]3 years ago
3 0

Answer:

To record he partial year’s depreciation on July 1, 2022

Dr Depreciation expenses              $7,500

      Cr Accumulated Depreciation  $7,500

(to record he partial year’s depreciation on July 1, 2022)

(1) To record disposal as machine is sold for $45,500 cash

      Dr Cash                                         $45,500

      Dr Accumulated Depreciation     $52,500

         Cr Loss on asset disposal         $7,000

         Cr Machinery                              $105,000

(2) To record insurance settlement of $25,000 due to the machine’s total destruction in a fire:

      Dr Cash                                         $25,000

      Dr Accumulated Depreciation     $52,500

         Cr Loss on asset disposal         $27,500

         Cr Machinery                              $105,000            

Explanation:

The depreciation expense for each year is (105K-0)/7 = $15K => Half-year depreciation expenses = 15K/2 = $7.5K. Thus in Jul 1,2022, we need to book $7K of depreciation expenses for half-year expenses of 2020.

To Jul 1, 2022, the asset has been on book for 3.5 years, thus the accumulated depreciation relating to the asset is 3.5 x 15K = $52.5K which makes the net book value of the asset $52.5K.

So, the sold of asset at $45,500 will results to a loss of $7,000 (45.5K-52.5K) and the insurance settlement of $25,000 will results to a loss of $27,500 (25K - 52.5K)

You might be interested in
The fixed asset turnover ratio is computed as __________ divided by __________.
Yuri [45]

The correct option is (a) sales; average book value of fixed assets.

The fixed asset turnover ratio is computed as sales divided by average book value of fixed assets.

The fixed asset turnover ratio demonstrates the effectiveness of a company's current fixed assets in driving sales. A greater ratio suggests that management is making better use of its fixed assets. No information can be gleaned from a high FAT ratio about a company's capacity to produce reliable earnings or cash flows.

The ratio of sales to the value of fixed assets is known as fixed-asset turnover. It shows how effectively the company is generating sales by utilizing its fixed assets.

A greater ratio is typically preferred since it suggests that the business is effective at producing sales or revenues from its asset base. A lower ratio suggests that a business is not utilizing its resources effectively and may be experiencing internal issues.

Learn more about fixed asset turnover ratio

brainly.com/question/24085720

#SPJ4

3 0
2 years ago
Riverbed Corp has 8,400 shares of common stock outstanding. It declares a $5 per share cash dividend on November 1 to stockholde
Paha777 [63]

Answer:

Date       Account Titles and Explanation        Debit           Credit

1-Nov     Cash Dividends                             $42,000

              (8,400 shares x $5)

             Dividends Payable                                                   $42,000

             (To record dividends payable)  

1-Dec      No entry on this date

31-Dec     Dividends Payable                     $42,000  

                Cash                                                                        $42,000

            (To record payment of cash dividend)  

4 0
3 years ago
Gummy Co. purchased merchandise on June 10 at a $9,000 invoice price with terms of 2/10,n/30 and paid for the merchandise on Jun
Olenka [21]

Answer:

June 10

Debit Purchases for $9,000: Gross method

June 30

Debit Discounts lost for $180: Net method

June 30

Credit Cash for $9,000 : Both methods

Explanation:

To Illustrate the required journal entries to record and pay for this purchase under the GROSS METHOD and NET METHODS by matching the action on the left with the method on the right using a PERIODIC INVENTORY SYSTEM.

June 10

Debit Purchases for $9,000: Gross method

June 30

Debit Discounts lost for $180: Net method

(2%*$9,000)

June 30

Credit Cash for $9,000 : Both methods

6 0
3 years ago
Free Trade Agreements promote which of the following?
Y_Kistochka [10]

Answer:

I beleive all of these would be the answer sorry if I am incorrect

Explanation:

8 0
3 years ago
1. The art of being a good Chemical Engineer lies in being a good mathematician, a good chemist, and a good mechanic – all simul
KengaRu [80]

Answer:

y_{oe}=0.5x+0.15\\y_{ce}=1.25x^2+0.1\\\\

for minimum cost the intersection point should be calculated i-e

0.5x+0.15=1.25x^2+0.1\\\\1.25x^2-0.5x-0.5=0\\

By using calculator

x_1=0.4828\\x_2=-0.4828

As x can't be negative so x=0.4828

It's the minimum value because as we decrease the operating cost further the capital value will increase so this is the minimum value.

Graphical solution:

5 0
3 years ago
Other questions:
  • Which of the following is not one of the four tasks for completion of a business message?
    10·1 answer
  • Do you think competition between co-workers is healthy destructive unavoidable
    5·1 answer
  • A manufacturer reports the information below for three recent years. Year 1 Year 2 Year 3 Variable costing income $ 120,500 $ 12
    10·1 answer
  • The hyattsville country club requires that an applicant's grandfather be a member of the club in order to qualify for membership
    11·1 answer
  • On January 1, Revis Consulting entered into a contract to complete a cost reduction program for Green Financial over a six-month
    8·1 answer
  • Unemployment would cause an economy to Group of answer choices produce outside its production possibilities frontier. produce in
    8·1 answer
  • Asarta Inc. is polluting into a nearby fishing stream; doing so benefits them $40,000 a year. The fishermen are unhappy as their
    7·1 answer
  • Suppose​ Dave's Discount's Merchandise Inventory account showed a balance of​ $8,000 before the​ year-end adjustments. The physi
    11·1 answer
  • What are some of the drawbacks from 2007 to 2009 you have encountered in your research for this discussion, why companies showed
    8·1 answer
  • Someone please help will mark as brainliest
    8·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!