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Golden Sales Has Bought $135,000 in Fixed Assets on January

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Essay

Golden Sales has bought $135,000 in fixed assets on January 1 associated with sales equipment. The residual value of these assets is estimated at $10,000 at the end of their four-year service life. Golden Sales managers want to evaluate the options of depreciation.​
(a) Compute the annual straight-line depreciation and provide the sample depreciation journal entry to be postedat the end of each of the years.
(b) Write the journal entries for each year of the service life for these assets using the double-declining-balancemethod.


Definitions:

Danish Cookies

Delicious sweet biscuits originating from Denmark, often enjoyed during holidays and special occasions, frequently coming in a tin box.

Brazilian Real

The official currency of Brazil, represented symbolically as R$ and subdivided into 100 centavos.

Invoice

A document from a seller requesting payment from the buyer; the supplier’s bill.

Mexican Peso

The currency of Mexico, symbolized as MXN, and used in financial transactions within the country.

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