Examlex

Solved

On April 30, 2013, a Fire Destroyed a Machine That

question 160

Essay

On April 30, 2013, a fire destroyed a machine that cost $24,000 when acquired on January 1, 2011. The machine has an estimated 4-year useful life and no residual value. Straight-line amortization on the machine has been recognized through December 31, 2011. Give the entries at date of the fire to record the fire loss, assuming the insurance company paid $9,000 cash on the claim.


Definitions:

Accord And Satisfaction

A legal contract wherein a dispute is settled by the parties agreeing and performing on a new obligation which differs from the original agreement.

Unliquidated Debt

Debt for which the specific value has not been determined, often because the exact amount depends on future events or conditions.

Unilateral Contract

A promise made by one party in exchange for the performance of an act by another party.

Bilateral Contract

A type of agreement in which both parties involved promise to perform certain actions or obligations.

Related Questions