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Equipment Was Purchased for $24,000 on January 1,2016

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Essay

Equipment was purchased for $24,000 on January 1,2016.The equipment's estimated useful life was five years,and its residual value was $4,000.The straight-line method of depreciation was used.Prepare the journal entry to record the sale of the equipment for $25,000 on January 3,2017.The company has a calendar year accounting period.


Definitions:

Fiscal Year

A one-year period chosen for accounting purposes, which may or may not align with the calendar year.

Seasonal Period

A specific time frame during the year when a particular industry or business expects a significant change in activity, often tied to seasons.

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