New lithographic equipment, acquired at a cost of $859,200 on March 1 of Year 1 (beginning of the fiscal year), has an estimated useful life of five years and an estimated residual value of $96,660. The manager requested information regarding the effect of alternative methods on the amount of depreciation expense each year.On March 4 of Year 5, the equipment was sold for $141,422. Required:1.Determine the annual depreciation expense for each of the estimated five years of use, the accumulated depreciation at the end of each year, and the book value of the equipment at the end of each year by (a) the straight-line method and (b) the double-declining-balance method. Round your answers to the nearest whole dollar.2.Journalize the entry to record the sale assuming that the manager chose the double-declining-balance method.3.Journalize the entry to record the sale in (2) assuming that the equipment was sold for $96,962 instead of $141,422. Refer to the Chart of Accounts for exact wording of account titles. b. Double-declining-balance methodAccumulated Depreciation,YearDepreciation ExpenseEnd of YearBook Value, End of Year1%2424%24342. 1. Determine the annual depreciation expense for each of the estimated five years of use, the accumulated depreciation at the end of each year, and the book value of the equipment atthe end of each year by (a) the straight-line method and (b) the double-declining-balance method. Round your answers to the nearest whole dollar.a. Straight-line methodAccumulated Depreciation,YearDepreciation ExpenseEnd of YearBook Value, End of Year$152,508$152,508152,508305,0163152,5084152,508152,508

Name: New lithographic equipment, acquired at a cost of $859,200 on March 1
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Description: New lithographic equipment, acquired at a cost of $859,200 on March 1 of Year 1 (beginning of the fiscal year), has an estimated useful life of five years and an estimated residual value of $96,660. The manager requested information regarding the eff

The portion of a fixed asset that has been deemed consumed in the current period is what is referred…

Answered: New lithographic equipment, acquired at…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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New lithographic equipment, acquired at a cost of $859,200 on March 1 of Year 1 (beginning of the fiscal year), has an estimated useful life of five years and an estimated residual value of $96,660. The manager requested information regarding the effect of alternative methods on the amount of depreciation expense each year.

On March 4 of Year 5, the equipment was sold for $141,422.

	Required:
1.	Determine the annual depreciation expense for each of the estimated five years of use, the accumulated depreciation at the end of each year, and the book value of the equipment at the end of each year by (a) the straight-line method and (b) the double-declining-balance method. Round your answers to the nearest whole dollar.
2.	Journalize the entry to record the sale assuming that the manager chose the double-declining-balance method.
3.	Journalize the entry to record the sale in (2) assuming that the equipment was sold for $96,962 instead of $141,422. Refer to the Chart of Accounts for exact wording of account titles.

b. Double-declining-balance method
Accumulated Depreciation,
Year
Depreciation Expense
End of Year
Book Value, End of Year
1
%24
24
%24
3
4
2.

1. Determine the annual depreciation expense for each of the estimated five years of use, the accumulated depreciation at the end of each year, and the book value of the equipment at
the end of each year by (a) the straight-line method and (b) the double-declining-balance method. Round your answers to the nearest whole dollar.
a. Straight-line method
Accumulated Depreciation,
Year
Depreciation Expense
End of Year
Book Value, End of Year
$152,508
$152,508
152,508
305,016
3
152,508
4
152,508
152,508

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