Question

Wiater Company operates a small manufacturing facility. On January 1, 2018, an asset account for the...

Wiater Company operates a small manufacturing facility. On January 1, 2018, an asset account for the company showed the following balances: Equipment $ 160,000 Accumulated Depreciation (beginning of the year) 100,000 During the first week of January 2018, the following expenditures were incurred for repairs and maintenance: Routine maintenance and repairs on the equipment $ 1,850 Major overhaul of the equipment that improved efficiency 24,000 The equipment is being depreciated on a straight-line basis over an estimated life of 15 years with a $10,000 estimated residual value. The annual accounting period ends on December 31.

Homework Answers

Answer #1
1
Debit Credit
Depreciation expense 10000 =(160000-10,000)/15
       Accumulated Depreciation-Equipment 10000
2
Years of use 10 =100000/10000
Remaining estimated life 5 years =15-10
3
Debit Credit
Repairs and Maintenance expense 1,850
        Cash 1,850
Equipment 24,000
        Cash 24,000

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