On April 1, Year 1, Raines Co. purchased and placed a plant asset in service. The following information is available regarding the plant asset: Acquisition cost $130,000Estimated salvage value$15,000Estimated useful life 5 yearsMake the necessary adjusting journal entries at December 31, Year 1, and December 31, Year 2 to record depreciation for each year under the double-declining balance depreciation method:

What will be an ideal response?



Year 1???
Dec. 31Depreciation Expense39,000?
?  Accumulated Depreciation?39,000
????
?($130,000 x 40%) x 9/12 = $39,000??
 
Year 2???
Dec. 31Depreciation Expense36,400?
?  Accumulated Depreciation?36,400
????
?($130,000 - $39,000) x 40% = $36,400??

Business

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