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Homework answers / question archive / The following data relate to the Machinery account of Eshkol, Inc
The following data relate to the Machinery account of Eshkol, Inc. at December 31, 2014.
Machinery
A B C D
Original cost 46,000 51,000 80,000 80,000
Year purchased 2009 2010 2011 2013
Useful life 10 years 15,000 hours 15 years 10 years
Salvage value 3,100 3,000 5,000 5,000
Depreciation method Sum-of-the- Activity Straight-line Double-
years-digits Declining- balance
Accum depre. through 2014 31,200 35,200 15,000 16,000
The following transactions occurred during 2015
(a)On May 5, Machine A was sold for 13,000 cash. The company's bookkeeper recorded this retirement in the following manner in the cash receipts journal
Cash 13,000
Machinery A 13,000
(b)On Dember 31, it was determined that Machine B had been used 2,100 hours during 2015.
(c)On December 31, before computing depreciation expense on Machine C, the management of Eshkol, decided the useful life remaining from January 1, 2015, was 10 years.
(d)On December 31, it was discovered that a machine purchased in 2014 had been expensed completely that year. This machine cost 28,000 and has a useful life of 10 years and no salvage value. Management had decided to use the double-declining balance method for this machine, which can be referred to as "Machine E."
Instructions
Prepare the necessary correcting entries for the year 2015. Record the appropriate depreciation expense on the above-mentioned machines.
