A Company Purchased and Installed Equipment on January 1 at a Total

question 123

Essay

A company purchased and installed equipment on January 1 at a total cost of $72,000. Straight-line depreciation was calculated based on the assumption of a five-year life and no salvage value. The equipment was disposed of on July 1 of the fourth year. The company uses the calendar year.
1. Prepare the general journal entry to update depreciation to July 1 in the fourth year.
2. Prepare the general journal entry to record the disposal if the equipment was sold for $22,000 cash.

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Definitions:

Construct Validity

The extent to which a test measures what it claims to be measuring.

Construct Validity

The degree to which a test measures what it claims to be measuring, specifically the ability of a measurement tool to actually measure the theoretical construct it intends to measure.

Criterion-related Validity

The extent to which a test's scores correlate with another measure or outcome that it is theoretically expected to predict.

Content Validity

The degree to which a test or measure reflects the entire range of material it is supposed to be testing.