Pharoah Co. purchased a machine on January 1, 2023, for $533,500. At that time, it was estimated that the machine would have a 10- year life and no salvage value. On December 31, 2026, the firm's accountant found that the entry for depreciation expense had been omitted in 2024. In addition, management has informed the accountant that the company plans to switch to straight-line depreciation. starting with the year 2026. At present, the company uses the sum-of-the-years'-digits method for depreciating equipment Prepare the general journal entries that should be made at December 31, 2026, to record these events. (Ignore tax effects.) (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.) Date Account Titles and Explanation Dec. 31, 2026 Debit Credit Dec. 31, 2026 (To correct for the omission of depreciation expense in 2024) (To record depreciation expense for 2026)

Pharoah Co. purchased a machine on January 1, 2023, for $533,500. At that time, it was estimated that the machine would have a 10- year life and no salvage value. On December 31, 2026, the firm's accountant found that the entry for depreciation expense had been omitted in 2024. In addition, management has informed the accountant that the company plans to switch to straight-line depreciation. starting with the year 2026. At present, the company uses the sum-of-the-years'-digits method for depreciating equipment Prepare the general journal entries that should be made at December 31, 2026, to record these events. (Ignore tax effects.) (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.) Date Account Titles and Explanation Dec. 31, 2026 Debit Credit Dec. 31, 2026 (To correct for the omission of depreciation expense in 2024) (To record depreciation expense for 2026)

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter22: Accounting For Changes And Errors.

Section: Chapter Questions

Problem 11E: On January 1, 2014, Klinefelter Company purchased a building for 520,000. The building had an...

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On May 1, 2022, Vontsira purchased equipment for $16,526,000 cash. The production team estimated that the equipment would last for 12 years and have a $826,000 salvage value. Unfortunatelydue to an error, no depreciation was recorded in 2022. The error was corrected when it was discovered at the end of 2023. Which of the following accounts will not be affected by the correction, assuming they use straight-line depreciation? (RE&CF 3) Depreciation Expense Accumulated Depreciation All of these accounts will be affected . Retained Earnings Which of the following is a counterbalancing error? (RE&CF 2) Recording research and development costs as expenses Recording a full year of straight line depreciation when PPE was purchased in August Recording permanent tax differences in deferred taxes Recording interest expense as a decrease to notes payable
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Metlock Corporation purchased a new machine for its assembly process on August 1, 2025. The cost of this machine was $141,600. The company estimated that the machine would have a salvage value of $15,600 at the end of its service life. Its life is estimated at 5 years, and its working hours are estimated at 20,000 hours. Year-end is December 31. Compute the depreciation expense under the following methods. Each of the following should be considered unrelated. (Round A depreciation rate per hour to 2 decimal places, e.g. 5.35 for computational purposes. Round your answers to O decimal places, e.g. 45,892.) (a) (b) (c) Straight-line depreciation for 2025 Activity method for 2025, assuming that machine usage was 850 hours Sum-of-the-years'-digits for 2026 (d) Double-declining-balance for 2026 eTextbook and Media Save for Later Search $ $ $ DELL Attempts: 0 of 3 used D Submit Answer
Concord Corporation purchased a new machine for its assembly process on August 1, 2025. The cost of this machine was $129,600. The company estimated that the machine would have a salvage value of $12,600 at the end of its service life. Its life is estimated at 5 years, and its working hours are estimated at 20,000 hours. Year-end is December 31. Compute the depreciation expense under the following methods. Each of the following should be considered unrelated. (Round depreciation rate per hour to 2 decimal places, e.g. 5.35 for computational purposes. Round your answers to O decimal places, e.g. 45,892.) (a) Straight-line depreciation for 2025 (b) (c) (d) Activity method for 2025, assuming that machine usage was 800 hours Sum-of-the-years'-digits for 2026 Double-declining-balance for 2026 $ $ LA $ 9,750 4,680 31,200 43,200