Question

Knowledge Check 01 

On January 1, a company purchased equipment that cost $10,000. The company has not yet recorded depreciation, which is estimated 1800 per year. The company w prepare financial statements at the end of January. Complete the necessary journal entry. If no entry is required for a transaction event, select "No journal entry required in the first account field.)

Answer 1

No	Date	General Journal	Debit	Credit
1	Jan 31	Depreciation Expense	$150
		Accumulated Depreciation		$150

1800 is the depreciation for the year, so 1800 *1/12=150, one month out of the full year.

Answer 2

No	Date	General Journal	Debit	Credit
1	Jan 31	Depreciation Expense	$1,800
		Accumulated Depreciation		$1,800