On December 31 Strike Company has decided to discard one of

On December 31, Strike Company has decided to discard one of its batting cages. The equipment had an initial cost of $227,600 and has accumulated depreciation of $204,840. Depreciation has been recorded up to the end of the year. Which of the following will be included in the entry to record the disposal?

a. Equipment, credit, $227,600

b. Accumulated Depreciation, debit, $227,600

c. Gain on Disposal of Asset, credit, $22,760

d. Loss on Disposal of Asset, debit, $204,840

Weber Company purchased a mining site for $510,045 on July 1. The company expects to mine ore for the next 10 years and anticipates that a total of 85,756 tons will be recovered. The estimated residual value of the property is $59,457. During the first year, the company extracted 5,300 tons of ore. The depletion expense is

a.$59,457.00

b.$31,522.44

c.$45,058.80

d.$27,847.81

Solution

1 Equipment, credit, $227,600 will be included in the entry to record the disposal 2 Depletion expense = (510045-59457)/85756*5300= 27847.81