Business, 18.07.2020 16:01 geminigirl077

Partial-year depreciation; asset addition; increase in useful life On April 1, 2009, the KB Toy Company purchased equipment to be used in its manufacturing process. The equipment cost $48,000, has an eight-year useful life, and has no residual value. The company uses the straight-line depreciation method for all manufacturing equipment.

On January 4, 2011, $12,350 was spent to repair the equipment and to add a feature that increased its operating efficiency. Of the total expenditure, $2,000 represented ordinary repairs and annual maintenance and $10,350 represented the cost of the new feature. In addition to increasing operating efficiency, the total useful life of the equipment was extended to 10 years.

Required:

Prepare journal entries for the following:

1. Depreciation for 2009 and 2010.

2. The 2011 expenditure.

3. Depreciation for 2011.

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Partial-year depreciation; asset addition; increase in useful life On April 1, 2009, the KB Toy Com...

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