Hybrid Dealers bought computer equipment for R54 000 on 1 July 2018. The equipment is depreciated at 20% according to the diminishing balance method. Prepare the depreciation and closing transfer entries in the general journal of Hybrid Dealers on 31 March 2019 and 31 March 2020.
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Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
Hybrid Dealers bought computer equipment for R54 000 on 1 July 2018. The equipment is
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- Hybrid Dealers bought computer equipment for R54 000 on 1 July 2018. The equipment is depreciated at 20% according to the diminishing balance method.Required:Prepare the depreciation and closing transfer entries in the general journal of Hybrid Dealers on 31 March 2019 and 31 March 2020.Hybrid dealers bought computer equipment for R54000 on 1 July 2018.The equipment is deprecated at 20% to the diminishing balance method. prepare the depreciation and closing transfer entries in the general journal of hybrid dealers on 31 March 2019 and 31 March 2020Hybrid Dealers bought computer equipment for R54 000 on 1 July 2018. The equipment is depreciated at 20% according to the diminishing balance method. Required: Prepare the depreciation and closing transfer entries in the general journal of Hybrid Dealers on 31 March 2019 and 31 March 2020. Please see attached for answer format
- Hybrid Dealers bought computer equipment for R54 000 on 1 July 2018. Theequipment is depreciated at 20% according to the diminishing balance method.Required:Prepare the depreciation and closing transfer entries in the general journal ofHybrid Dealers on 31 March 2019 and 31 March 2020 respectively.Prepare journal entries to record the following transactions. You are required to show all calculations: the financial year-end of the client is 30 November 2021. 3.1 The company adopted the straight-line depreciation method. Record the 15% depreciation on the plant and equipment purchased On 1 December 2020 for R125 000. 3.2 The allowance for credit losses account has an opening balance of R4 500. The policy requires the allowance to equate 8% of the total accounts receivable. The debtors sub-ledger totaled R52 000 prior receiving 40c in the rand on an account of R3 000. The financial manager instructed the write off on the balance WITH GENERAL LEDGER ENTERIES: Please dont provide answer in image format thnkuGunkelson Company sells equipment on September 30, 2019, for $18,000 cash. The equipment originally cost $72,000 and as of January 1, 2019, had accumulated depreciation of $42,000. Depreciation for the first 9 months of 2019 is $5,250.Prepare the journal entries to (a) update depreciation to September 30, 2019, and (b) record the sale of the equipment. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
- Novak Company sells equipment on September 30, 2020, for $19,100 cash. The equipment originally cost $74,800 and as of January 1, 2020, had accumulated depreciation of $42,100. Depreciation for the first 9 months of 2020 is $5,050.Prepare the journal entries to (a) update depreciation to September 30, 2020, and (b) record the sale of the equipment. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) No. Account Titles and Explanation Debit Credit (a) (b)Respond to the requirements in each situation. Instructions a. On January 1, 2020, Zarle Inc. sold computer equipment to Daniell Co. The sales price of the equipment was $520,000 and its carrying amount is $400,000. Record any journal entries necessary for Zarle from the sale of the computer equipment in 2020. b. Use the information from part a. Assume that, on the same day the sale occurred, Zarle enters into an agreement to lease the equipment from Daniell for 10 years with annual lease payments of $67,342.42 at the end of each year, beginning on December 31, 2020. If Zarle has an incremental borrowing rate of 5% and the equipment has an economic useful life of 10 years, record any journal entries necessary for Zarle from the sale and leaseback of computer equipment in 2020. c. Use the information from part b. Now, instead of 10 years, the lease term is only 3 years with annual lease payments of $67,342.42 at the beginning of each year. Record any journal entries necessary…Whispering Company signed a long-term noncancelable purchase commitment with a major supplier to purchase raw materials in 2026 at a cost of $967,800. At December 31, 2025, the raw materials to be purchased have a market value of $917,200. Prepare any necessary December 31, 2025, entry. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts.) Date Account Titles and Explanation Dec. 31 Estimated Liability on Purchase Commitments Debit 50600 Credit 50600
- The Delivery Equipment account of Freedom Company showed the following details for 2022:Delivery Equipment01.01.22 Balance 1,500,00001.15 5,000 08.30 225,00009.30 535,000 10.31 180,000 Your examination disclosed the following:a. The P5,000 charged to the Delivery Equipment account on January 15, 2022 represents paymentof LTO registration fees for the company’s delivery equipment for the year 2022.b. The company bought a second-hand delivery truck on September 30 for P535,000, whichincludes P35,000 worth of comprehensive insurance for one year effective October 1, 2022.c. The company wrote-off a fully depreciated truck with an original cost of P225,000 on August 30;further verification disclosed that this truck is still being used by the company.d. The credit of P180,000 on October 31 represents proceeds from sale of one truck costingP350,000, which is 50% depreciated as of December 31, 2021.e. There is only one entry made to the Accumulated Depreciation account during 2022, a debit…Baggage Solutions Ltd manufactures top of the range luggage bags that are extremely light weight, strong and durable. The company specialises in trolley bags, and these can be sold separately or as part of a set. The company’s financial year end is 31 March. The following information is available as at 31 March 2021. Land and buildings Baggage Solutions Ltd purchased land with a warehouse from Property Direct for R9 444 375, and the transfer of the land and building was concluded on 1 July 2019. The normal payment terms of Property Direct is 2 months after transfer date. The agreement between Baggage Solutions Ltd and Property Direct states that payment for the property should occur on 1 July 2020. The land constitutes 20% of the purchase price of the property. The useful life and residual value of the warehouse is 25 years and R900 000 respectively. On 1 April 2020 the fair value of the property is R8 700 000. Vacuum forming machine The machine was purchased on 1 April 2018, for R525…Baggage Solutions Ltd manufactures top of the range luggage bags that are extremely light weight, strong and durable. The company specialises in trolley bags, and these can be sold separately or as part of a set. The company’s financial year end is 31 March. The following information is available as at 31 March 2021. Land and buildings Baggage Solutions Ltd purchased land with a warehouse from Property Direct for R9 444 375, and the transfer of the land and building was concluded on 1 July 2019. The normal payment terms of Property Direct is 2 months after transfer date. The agreement between Baggage Solutions Ltd and Property Direct states that payment for the property should occur on 1 July 2020. The land constitutes 20% of the purchase price of the property. The useful life and residual value of the warehouse is 25 years and R900 000 respectively. On 1 April 2020 the fair value of the property is R8 700 000. Vacuum forming machine The machine was purchased on 1 April 2018, for R525…