Monday 17 March 2014

Because the actual production is based on four months, we do not need to scale-down the $1,783 calculated depreciation. It already represents four months of depreciation. The following are the transactions of Morrell Corporation. a. Morrell Corporation disposed of two computers at the end of their useful lives. The computers had cost $3,900 and their Accumulated depreciation was $3,900. No residual value was received. b. Assume the same information as (a),except that Accumulated depreciation, updated to the date of disposal, was $2,600. Required: Prepare journal entries to record these transactions (Omit the "$" sign in your response): Event General Journal Debit Credit a. Accumulated depreciation Computers b. Accumulated depreciation Loss on disposal Computers


Because the actual production is based on four months, we do not need to scale-down the $1,783 calculated depreciation. It already represents four months of depreciation.


The following are the transactions of Morrell Corporation.
 
a. 
Morrell Corporation disposed of two computers at the end of their useful lives. The computers had cost $3,900 and their Accumulated depreciation was $3,900. No residual value was received.
b. 
Assume the same information as (a),except that Accumulated depreciation, updated to the date of disposal, was $2,600.

Required:
Prepare journal entries to record these transactions (Omit the "$" sign in your response):
 
Event
General Journal
Debit
Credit
a.
  Accumulated depreciation



       Computers






b.
  Accumulated depreciation



  Loss on disposal



       Computers




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