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Williams Company acquired machinery on July 1, 2009, at a cost of $130,000. The estimated useful life of the machinery was 10 years and the estimated residual value was $10,000. Williams uses the double-declining-balance method of depreciation. On October 1, 2012, Williams sold the equipment for $75,000.

1) Record the journal entry for the depreciation on this machinery for 2012.

2) Record the journal entry for the sale of the machinery.

XYZ Co. incurred the following costs related to the office building used in operating its sports supply company:

a.Replaced a broken window.

b.Replaced the roof that had been on the building 23 years.

c.Serviced all the air conditioners before summer started.

d.Replaced the air conditioners with refrigerated air conditioners in the customer service areas.

e.Added a warehouse to the back of the building.

f.Repainted the interior walls.

g.Installed window shutters on all windows.

Classify each of the costs as a capital expenditure or a revenue expenditure. For those costs identified as capital expenditures, classify each as an additional or replacement component.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9957286

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