If a fixed asset, such as a computer, was purchased on January 1 for $3,750 with an estimated life of 3 years and a salvage orresidual value of $150, the journal entry for the monthly expense under straight-line depreciation isa. Depreciation Expense100Accumulated Depreciation1,200Accumulated Depreciation1,200100b. Depreciation Expense1,200c. Accumulated DepreciationDepreciation Expensed. Accumulated DepreciationDepreciation Expense1,200100100O DO A

Depreciation is the wear and tear of an asset that is charged to profit and loss account under…

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100 Depreciation Expense Accumulated Depreciation a. 100

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter18: Accounting For Long-term Assets

Section: Chapter Questions

Problem 3CE: A machine costing 350,000 has a salvage value of 15,000 and an estimated life of three years....

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Question

If a fixed asset, such as a computer, was purchased on January 1 for $3,750 with an estimated life of 3 years and a salvage or
residual value of $150, the journal entry for the monthly expense under straight-line depreciation is
a. Depreciation Expense
100
Accumulated Depreciation
1,200
Accumulated Depreciation
1,200
100
b. Depreciation Expense
1,200
c. Accumulated Depreciation
Depreciation Expense
d. Accumulated Depreciation
Depreciation Expense
1,200
100
100
O D
O A

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A machine costing 350,000 has a salvage value of 15,000 and an estimated life of three years. Prepare depreciation schedules reporting the depreciation expense, accumulated depreciation, and book value of the machine for each year under the double-declining-balance and sum-of-the-years-digits methods. For the double-declining-balance method, round the depreciation rate to two decimal places.
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