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1 December, 08:35

Depreciation on equipment for the year is $3,480. Required: (a) Record the journal entry if the company prepares adjustments once a year. (b) Record the journal entry if the company prepares adjustments on a monthly basis

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  1. 1 December, 09:01
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    See explanation section

    Explanation:

    A) To record the journal entry of annual adjustments of depreciation on equipment -

    Debit Depreciation expense - Equipment $3,480

    Credit Accumulated depreciation $3,480

    Note: As the depreciation expense $3,480 is for one year, the entire amount will be debited to adjust the expense.

    B) To record the journal entry of monthly adjustments of depreciation on equipment -

    Debit Depreciation expense - Equipment $290

    Credit Accumulated depreciation $290

    Note: As the depreciation expense $3,480 is for one year, the monthly expense is = $ (3,480/12) = $290 amount will be debited to adjust the expense for each month.
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