On April 1,2010,SAS Corp Make the Necessary Adjusting Journal Entries at December 31,2010 and Asset.The

question 153

Essay

On April 1,2010,SAS Corp.purchased and placed in service a plant asset.The following information is available regarding the plant asset:
$\begin{array}{|l|r|}\hline \text { Acquisition cost } & \$ 130,000 \\\hline \text { Estimated salvage value } & \$ 15,000 \\\hline \text { Estimated useful life } & 5 \text { years } \\\hline\end{array}$
Make the necessary adjusting journal entries at December 31,2010 and December 31,2010 to record depreciation for each year under the following depreciation methods:
a. Straight-line
b. Double-declining-balance.

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Definitions:

Present Value

The contemporary valuation of a future money sum or cash flow series, based on a predetermined return rate.

Time Value

The idea that having money now is more valuable than having the same sum in the future because of its ability to generate earnings.

Money Concept

A financial principle that emphasizes the role of currency in transactions and as a measure of value in the economic system.

Net Present Value Method

A financial analysis technique that discounts all cash flows associated with a project to their present value to help assess the project's profitability.