Question

Amy Washington is continuing to review business practices.​ Currently, she is reviewing the​ company's property,​ plant, and equipment and has gathered the following​ information:
Estimated Residual Value $ 0 Estimated Life 4 years Monthly Depreciation E xpense Asset Depreciation Method SL nla $ Acquisition Date Nov 3, 2018 Dec 1, 2018 Dec 1, 2018 Dec 2, 2018 Mar 2, 2019 Mar 3, 2019 Canoes Land Building Canoes Computer Office Furniture Cost 7,680 110,000 104,000 4,800 3,600 2.400 20,000 10 years 4 years 4 years 5 years 400 1.200 SL = Straight-line, DDB = Double-declining balance
1. Calculate the amount of monthly depreciation expense for the computer and office furniture for 2019
2. For each asset, determine the book value as of December 31, 2018. Then, calculate the depreciation expense for the first six months of 2019 and the book value as of June 30, 2019
3. Prepare a partial balance sheet showing Property, Plant, and Equipment as of June 30, 2019 Requirement

Answer 1

Answer:

* Data is Incomplete the picture of original question is attached and answer is made accordingly.

(1)

Double Declining Depreciation Rate = (Depreciation Expense / Depreciation base )  x 2

Computer

Double Declining Depreciation Rate = [(( 3600 - 400 ) / 4 ) x 2] / 12 = $133.33

Office Furniture

Double Declining Depreciation Rate = [(( 2400 - 1200 ) / 5 )] / 12 = $20

(2) Book value as of December 31, 2018

Canoes = 7,680 - ( 160 x 2 ) = $7,360

Land = 110,000

Building = 104,000 - 700 = 103,300

Canoes = 4,800 - 400 = 4,400

Computer = 0

Office Furniture = 0

Expense for The six Months June 30 , 2019

Canoes = 260 x 6 = 1,560

Land = 110,000 x 0 = 0

Building = 700 x 6 = 420

Canoes = 100 x 6 = 600

Computer = 4 x 133.33 = 533.32

Office Furniture = 20 x 4 = 80

(3) Balance sheet as of June 30, 2019

Canoes ( 7360 - 1560 )                   $5,800

Land                                                 $110,000

Building ( 130,300 - 420 )               $129,880

Canoes ( 4,400 - 600 )                   $3,800

Computer ( 3,600 - 533 )               $3,067

Office Furniture (2,400 - 80 )        $2,320

Total Property plant and Equipment                $254,867