Vaughn Manufacturing purchased equipment for $15300 on December 1. It is estimated that annual depreciation on the computer will be $3060.

If financial statements are to be prepared on December 31, the company should make the following adjusting entry:

A) debit Depreciation Expense, $250, credit Accumulated Depreciation, $250.

B) debit Depreciation Expense, $3,060: credit Accumulated Depreciation, $3,060.

C) debit Equipment, $15,300: credit Accumulated Depreciation, $15,300.

D) debit Depreciation Expense, $12,240: ccredit Accumulated Depreciation, $12,240.

E) None of the above.

Question

Campbell Walsh

Business

26 July, 11:43

Vaughn Manufacturing purchased equipment for $15300 on December 1. It is estimated that annual depreciation on the computer will be $3060.

If financial statements are to be prepared on December 31, the company should make the following adjusting entry:

A) debit Depreciation Expense, $250, credit Accumulated Depreciation, $250.

B) debit Depreciation Expense, $3,060: credit Accumulated Depreciation, $3,060.

C) debit Equipment, $15,300: credit Accumulated Depreciation, $15,300.

D) debit Depreciation Expense, $12,240: ccredit Accumulated Depreciation, $12,240.

E) None of the above.

+1

Answers (1)

Know the Answer?

Mario Lam · Answer 1

The correct answer is option (E).

Explanation:

According to the scenario, computation of the given data are as follows:

Equipment = $15,300

Estimated annual depreciation = $3,060

Time period = 1 month

So, Depreciation = $3,060 * 1 : 12

= $255

So, Here journal entry are as follows:

Depreciation A/c Dr $255

To Accumulated depreciation A/c $255

(Being the depreciation is recorded)