A Company Purchased a Heating System on January 2,2000,for $225,000

question 176

Essay

A company purchased a heating system on January 2,2000,for $225,000.The system had an estimated useful life of 15 years.On January 3,2013,the company completed a renovation of the system that cost of $33,000 and now expects the system to be more efficient to last eight years beyond the original estimate.The company uses the straight-line method of depreciation.
a.Prepare the journal entry at January 3,2013,to record the renovation of the heating system.
b.Prepare the journal entry at December 31,2013,to record the depreciation for 2013.

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Definitions:

Negative Elements

Factors or components in a system or environment that detract from its value or function.

Business Decisions

Choices or judgements made within a business context to direct company strategies and operations.

Face-To-Face

Direct communication or interaction between individuals in the same physical location, often considered more personal and effective for complex discussions.

Informative Messages

Communications that provide data, insights, or knowledge in a clear and comprehensible manner.