138. A company entered into the following transactions concerning its computer system:
On January 1, 2012purchased a computer system that cost $1,480,000. The estimated useful life of the computer is 3 years and salvage value is $40,000. Straight-line depreciation is to be used. On January 1, 2013the company determined that the estimated useful life of the computer would be 4 years instead of 3 years. The estimated salvage value will only be $10,000.
a. Prepare the journal entry to record depreciation expense for 2012.
b. Prepare the journal entry to record depreciation expense for 2013.
139. The Weiss Company purchased a truck for $95,000 on January 2, 2011. The truck was estimated to have a $3,000 salvage value and a four-year life. The truck was depreciated using the straight-line method. During 2013, it was obvious that the truck's total useful life would be sixyears rather than fourand the salvage at the end of the sixth year would be $1,500. Determine the depreciation expense for the truck for the sixyears of its life.
Year
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Depreciation Expense
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2011
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2012
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2013
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2014
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2015
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2016
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140. Mahoney Company had the following transactions involving plant assets during 2012and 2013. Unless otherwise indicated, all transactions were for cash.
2012
|
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Jan. 2
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Purchaseda truck for $50,000. Sales tax on the truck was $3,000, and the license was $250. The truck is expected to have a $4,000 salvage value and a four-year life.
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Jan. 3
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Paid $1,500 to have the company’s logo painted on the truck. This did not change the truck’s salvage value.
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Dec.31
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Recorded straight-line depreciation on the truck.
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|
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2013
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Jan. 5
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Paid $5,000 to put a bigger engine in the truck. This new engine is expected to make the truck run more efficiently and will increase the truck’s useful life by one year. The salvage value remained at $4,000.
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Mar. 1
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Paid $2,000 to replace a broken tailgate. The tailgate was damaged when a heavy carton was inadvertently dropped on it.
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Dec.31
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Recorded straight-line depreciation on the truck.
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Prepare the general journal entries to record these transactions.