117) Rainier Corporation purchased five automobiles at the beginning of 2009 for a total cost of $125,000. Rainier Corporation estimates the total residual value of the five automobiles to be $25,000 and their estimated useful life at 5 years. Use the double declining balance method to calculate the depreciation expense for 2009 and 2010.
118) Barlow Trail Corporation purchased office equipment on September 30, 2010, for a total cost of $50,500. Management estimated useful life at 15 years and residual value at $5,500. Straight-line depreciation is used and computed to the nearest whole month. Barlow Trail Corporation's year end is December 31.
Required:
a. Prepare the adjusting entry for depreciation on December 31, 2010.
b. Early in 2012, management revised its estimates of useful life and residual value for the office equipment. Useful life was reduced to a total of 10 years, and residual value was reduced to $2,000. Prepare the adjusting entry for depreciation on December 31, 2012, using the revised estimate.
119) Victory Stables purchased new equipment for their barn on January 1, 2009. The new equipment had a cost of $100,000, estimated salvage of $20,000 and an expected useful life of 10 years. On January 1, 2010 the equipment is not working out to be as durable as first thought so management has now revised its useful life down to 5 years. Prepare the journal entry for the December 31, 2010 amortization.
120) Victory Stables purchased new equipment for their barn on July 1, 2010. The new equipment had a cost of $100,000, estimated salvage of $20,000 and an expected useful life of 10 years. Prepare the journal entry for the December 31, 2010 and 2011 amortization. Note: Victory Stables uses the straight-line method of depreciation.
121) Foothills Industries gathered the following data for the year ended December 31, 2010, related to its equipment.
Accumulated
EquipmentDepreciation
January 1, 2010, balance$88,000$40,000
Total debits to the account 55,000?
Total credits to the account? 56,000
December 31, 2010, balance 92,000 57,000
Based on the above data, prepare the journal entry to record the sale of equipment during the year for $9,000 cash.