ch22_sol

# ch22_sol - Name: Solution Date: Instructor: Course:...

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d8df7b862ba6d06e23c1d7679927f5e70c164168.xlsx, Exercise 22-9 Solution, Page 1 of 8, 03/29/2012, 01:32:37 Name: Solution Date: Instructor: Course: January 1, 2009, for \$440,000.00 At that time it was estimated that the machine would have a 10 -year life and no salvage value. On December 31, 2012, the firm’s Instructions: Dec 31, 12 Retained Earnings [\$440,000 × (9/55)] 72,000 Accumulated Depreciation—Machinery 72,000 To correct for the omission of depreciation expense in 2010 Cost of Machine \$440,000 Less: Depreciation prior to 2012 Sum-of-the-years’-digits depreciation 2009 [\$440,000 × (10/55)] \$80,000 2010 [\$440,000 × (9/55)] 72,000 2011 [\$440,000 × (8/55)] 64,000 216,000 Book Value at January 1, 2012 \$224,000 7 Depreciation for 2012: \$32,000 Dec 31, 12 Depreciation Expense 32,000 Accumulated Depreciation—Equipment 32,000 To record depreciation expense for 2012 Intermediate Accounting , 14 th Edition by Kieso, Weygandt, and Warfield Primer on Using Excel in Accounting by Rex A Schildhouse E22-9 (Error and Change in Estimate—Depreciation) Tarkington Co. purchased a machine on accountant found that the entry for depreciation expense had been omitted in 2010. In addition, management has informed the accountant that the company plans to switch to straight-line depreciation, starting with the year 2012. At present, the company uses the sum-of-the-years’-digits method for depreciating equipment. Prepare the general journal entries that should be made at December 31, 2012, to record these events. (Ignore tax effects.)

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d8df7b862ba6d06e23c1d7679927f5e70c164168.xlsx, Exercise 22-9, Page 2 of 8, 03/29/2012, 01:32:37 Name: Date: Instructor: Course: January 1, 2009, for \$440,000.00 At that time it was estimated that the machine would have a 10 -year life and no salvage value. On December 31, 2012, the firm’s Instructions: Dec 31, 12 Account title Amount Account title Amount Text entry as appropriate Cost of Machine Amount Less: Depreciation prior to 2012 Sum-of-the-years’-digits depreciation 2009 Formula Formula 2010 Formula Formula 2011 Formula Formula Formula Book Value at January 1, 2012 Formula Number Depreciation for 2012: Formula Dec 31, 12 Account title Amount Account title Amount Text entry as appropriate Intermediate Accounting , 14 th Edition by Kieso, Weygandt, and Warfield Primer on Using Excel in Accounting by Rex A Schildhouse E22-9 (Error and Change in Estimate—Depreciation) Tarkington Co. purchased a machine on accountant found that the entry for depreciation expense had been omitted in 2010. In addition, management has informed the accountant that the company plans to switch to straight-line depreciation, starting with the year 2012. At present, the company uses the sum-of-the-years’-digits method for depreciating equipment. Prepare the general journal entries that should be made at December 31, 2012, to record these events. (Ignore tax effects.)
d8df7b862ba6d06e23c1d7679927f5e70c164168.xlsx, Exercise 22-11 Solution, Page 3 of 8, 03/29/2012, 01:32:38 Name: Solution Date: Instructor: Course: \$710,000 which was estimated to have a useful life of 10 years with a salvage value of \$10,000 at the end of that time. Depreciation has been entered for 7 years on a straight-line basis. In 2013, it is determined that the total estimated life should be 15 years with a salvage value of \$4,000 at the end of that time.

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## This note was uploaded on 03/28/2012 for the course ACC 401 taught by Professor O during the Spring '12 term at Regis University.

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ch22_sol - Name: Solution Date: Instructor: Course:...

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