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Homework answers / question archive / QUESTION 3 On January 1, 2020 Company purchases a printer at $800 by issuing a note and company also pays in cash $100 duty tax and $20 for transportation
QUESTION 3 On January 1, 2020 Company purchases a printer at $800 by issuing a note and company also pays in cash $100 duty tax and $20 for transportation. Its useful life is estimated as 4 years and the residual value is $100. 2 Make the joumal entry for the purchase in January 2020 (10 points) b. Fill in the depreciation schedule using straight line method (10 points) Years Computation Dep. Expense l? ta. Book Value
View AaBbc AaBBC AaBbc AaBBC Az Heading 4 Heading 5 Heading 6 Heading 7 11 Paragraph Styl ... 3. 4 1.. 5 ... 1 + 6 .. UNIVERSITY c. Fill in the depreciation schedule using double declining method (10 points) Years Computation Dep. Expense Acc. Dep. Book Value
Total printer cost = $ 800 + $ 100 + $ 20
= $920
a) Journal entry
Jan 2020 Printer account dr $920
To note payable account $920
(Being Printer is purchased)
b) Depreciation schedule using Straight line method
Printer cost = $ 920
Useful life = 4 years
Residual value = $100
Depreciation per year = (920 - 100)/4
= 205
| Years | computation | Dep Exp | Accu Dep | Book Value |
| 1 | (920 - 100)/4 | 205 | 205 | 920 |
| 2 | (920 - 100)/4 | 205 | 410 | 920 |
| 3 | (920 - 100)/4 | 205 | 615 | 920 |
| 4 | (920 - 100)/4 | 205 | 820 | 920 |
At the end of 4 th Year Accumulated Dep Tansferred to Printer account And thus only Residual value Present there
c) Depreciation schedule using Double declining method
Dep % = 100%
Useful life = 4 years
Normal Dep Rate = 100%/4
= 25%
Double Declining Rate = 25%*2
= 50%
| Years | computation | Dep Exp | Accu Dep | Book Value |
| 1 | 920 -( 50% of 920) | 460 | 460 | 920 |
| 2 | 460 -(50% of 460) | 230 | 690 | 920 |
| 3 | 230 -(50% of 230) | 115 | 805 | 920 |
| 4 | 115 - 100 | 15 | 820 | 920 |
