Ask Me Help Desk - Accumulated depreciation

Quote:

Originally Posted by John_eard

Not sure if there is a trick or not?

The question is to adjust the entries at the end month

The info given is that :Office equipment is fully depreciated over a period of 5 years.
(straight line depreciation)

Cx bought only a typewriter for $ 421 for the month of July

The other info is on May 31
after closing trial balance

Office equipment…….18000
Accumulated depreciation: office equipment….2100.

I know I have to adjust the value of the typewriter bought in June over a period of 5 years each month. Each equipment depreciates every month ? So what about the values given in May ?

help

Dr.Office equipment... 421
Cr.Cash... 421
assuming the purchased was made on cash
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end of July this entries are assuming if you actually bought the typewritter on July as you first said in your post

Dr.Depreciation expense-office equipment... 7
Cr. Accumulated depreciation equipment... 7
this is to record the depreciation on the typewritter assuming it was bought at the beginning of the month

Dr.Depreciation expense- office equipment... 600
Cr.Accumulated depreciation-office equipment... 600
to adjust the depreciation on the rest of the office equipment

July 31 balances
Office equipment... 18,421
Accumulated depreciation- office equipment... 2,707
Depreciation expense-office equipment... 607
those balances are if you bought the typewriter on July as you first said.

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if the typewriter was bought @ the beginning of June, this entry is assuming you bought the typewritter on June as you said at the end of your post

Dr. Depreciation expense-office equipment... 614
Cr.Accumulated depreciation-office equipment... 614
18,421/5= 3,684/12=307 x 2= 614

July 31 balances, assuming you bought the typewriter on June as you said later, and no adjustments were made during June
Office equipment... 18,421
Accumulated depreciation-office equipment... 2,714
Depreciation expense-office equipment... 614
Hope this could help you.