Information for Heterogeneous Assets A, B, and C of Health

question 38

Essay

Information for heterogeneous assets A, B, and C of Health Clubs of America is provided below.The company uses composite depreciation for these assets.
$\begin{array}{llll}&&\text {Estimated Residual}&\text {Estimated}\\\text { Asset}&\text { Cost}&\text {Value}&\text { Life}\\\text { A } & \$ 100,000 & \$ 10,000 & 9 \text { yerrs } \\\text { B } & 60,000 & 4,000 & 8 \text { yers } \\\text { C } & 40,000 & 8,000 & 4 \text { years }\end{array}$ Required:
a. Calculate the composite depreciation rate.
b. Journalize the sale of Asset C for $\$ 28,000$ after two full years of use

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