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    phlebmedic's Avatar
    phlebmedic Posts: 1, Reputation: 1
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    #1

    Feb 2, 2008, 10:48 AM
    journaling straight line depreciation.
    This is a two part question I'm so confused.

    A) ABC Company decided to trade in computer #48 for a new computer #50 and paid $20,000 cash. Computer #50 will be used for 3 years with the salavage/trade-in value of $15,000. Invoice for exchange showed the following:

    Price of new computer #50 $90,000
    Trade-in allowance granted on old computer #48 $70,000
    Total of purchase price paid in cash $20,000

    B) Please record straight line depreciation on computer # 50.
    justwonder2's Avatar
    justwonder2 Posts: 12, Reputation: 2
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    #2

    Feb 3, 2008, 02:35 PM
    I'm sorry I only see the question for part B, which is:
    New Computer : $90,000
    Minus Salvage : $15,000
    Equals : $75,000

    Depreciatiion expense for one year is: $75,000/3 = $25,000

    Hope this helps
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