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

question 149

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 $15,000 cash.

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Definitions:

12th Graders

Students typically in the final year of secondary education in the United States, usually aged 17 or 18.

Meritocracy

A system in which advancement within the system is based on individual ability or achievement.

Stratification System

The hierarchical arrangement of individuals or groups in society, based on wealth, power, race, education, etc., that affects their access to resources and opportunities.

Equality Of Opportunities

The principle that all individuals should have the same chances to succeed in life, regardless of their background, race, gender, or other personal characteristics.