2293 Chapter 8 Textbook Solutions 292

2293 Chapter 8 Textbook Solutions 292 - Chapter 8 Textbook...

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Chapter 8 Textbook Solutions 8-19 a) Total Basket purchase = $105,000 Machine #X [36,000 ÷ (36,000 + 84,000)] x $105,000 = $31,500 Machine #Y [84,000 ÷ (36,000 + 84,000)] x $105,000 = $73,500 Oct 3 Machine X 31,500 Cash 31,500 Machine Y 73,500 Cash 73,500 b) Oct 7 Machine X 1,800* Machine Y 4,200* Cash 6,000 * using the same ratio as the initial basket purchase Oct 27 Machine Y 7,800 Cash 7,800 8-19 (continued) c) Machine X amortization: (31,500 + 1,800) x 40%* x 62/365 = $2,263 * Double-declining balance rate = 1/5 x 2 = 40% Machine Y amortization: (73,500 + 4,200 + 7,800 – 13,500) ÷ 6 x 62/365 = $2,038 Dec 31 DR Amortization Machine X 2,263 DR Amortization Machine Y 2,038 CR Acc. Amortization – Mach X 2,263 CR Acc. Amortization – Mach Y 2,038
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8.20 a) For Building purchase Building $600,000 Cash 600,000 Amortization = ($600,000 - $40,000) ÷ 40 = $ 14,000 DR Amortization – Building 14,000 CR Acc. Amortization 14,000 b) For 2008 Amortization = $600,000 x (1/40 x 2) = $30,000
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2293 Chapter 8 Textbook Solutions 292 - Chapter 8 Textbook...

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