Problem_11-3 - Problem 11-3 The following data relate to...

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Problem 11-3 The following data relate to the Machinery account of Novak, Inc. at December 31, 2017. Machinery A B C D Original cost $53,360 $59,160 $92,800 $92,800 Year purchased 2012 2013 2014 2016 Useful life 10 years 15,000 hours 15 years 10 years Salvage value $3,596 $3,480 $5,800 $5,800 Depreciation method Sum-of-the- years'-digits Activity Straight -line Double-declining balance Accum. depr through 2017* $36,192 $40,832 $17,400 $18,560 *In the year an asset is purchased, Novak, Inc. does not record any depreciation expense on the asset. In the year an asset is retired or traded in, Novak, Inc. takes a full year’s depreciation on the asset. The following transactions occurred during 2018. (a) On May 5, Machine A was sold for $15,080 cash. The company’s bookkeeper recorded this retirement in the following manner in the cash receipts journal. Cash 15,080 Machinery (Machine A) 15,080 (b) On December 31, it was determined that Machine B had been used 2,436 hours during 2018. (c) On December 31, before computing depreciation expense on Machine C, the management of Novak, Inc. decided the useful life remaining from January 1, 2018, was 10 years. (d) On December 31, it was discovered that a machine purchased in 2017 had been expensed

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