Answer:
Depreciation expense $95,000
To Accumulated depreciation $95,000
(Being the depreciation expense is recorded)
Explanation:
The journal entry is shown below:
Depreciation expense $95,000
To Accumulated depreciation $95,000
(Being the depreciation expense is recorded)
The computation is shown below:
= (Cost installed - Residual value) ÷ Useful life
= ($920,000 - $160,000) ÷ 8
= $95,000
For recording this journal entry we debited the depreciation expense as it is increased the expenses while at the same time it decreased the value of the fixed assets so the accumulated depreciation is credited
