Question

Exercise 9-08 On July 1, 2019, Crane Company purchased new equipment for $75,000. Its estimated useful life was 5 years with a 58,000 salvage value. On December 31, 2022, the company estimated that the equipment's remaining useful life was 10 years, with a revised salvage value of $5,000. Prepare the journal entry to record depreciation on December 31, 2019. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter o for the amounts.) Account Titles and Explanation Debit Credit SHOW LIST OF ACCOUNTS LINK TO TEXT Prepare the journal entry to record depreciation on December 31, 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter o for the amounts.) Account Titles and Explanation Debit Credit SHOW LIST OF ACCOUNTS LINK TO TEXT Compute the revised annual depreciation on December 31, 2022. Revised annual depreciation SHOW LIST OF ACCOUNTS LINK TO TEXT Prepare the journal entry to record depreciation on December 31, 2022. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter o for the amounts.) Account Titles and Explanation Debit Credit SHOW LIST OF ACCOUNTS LINK TO TEXT Compute the balance in Accumulated Depreciation Equipment for this equipment after depreciation expense has been recorded on December 31, 2022. Accumulated Depreciation-Equipment

Answer 1

a) Journal entry

Account and explanation	Debit	Credit
Depreciation expense (75000-8000/5)*6/12	6700
Accumulated depreciation-equipment		6700

b) Journal entry

Account and explanation	Debit	Credit
Depreciation expense (75000-8000/5)	13400
Accumulated depreciation-equipment		13400

c) Revised annual depreciation = (75000-33500-5000)/10 = 3650

d) Journal entry

Account and explanation	Debit	Credit
Depreciation expense	3650
Accumulated depreciation-equipment		3650

e) Accumulated depreciation = 33500+3650 = $37150