Create the journal entry to record the amortization expense

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On January 1, 2003, Mira Ltd. acquired equipment for $800,000 in cash to manufacture coffee makers. The equipment was expected to have a life of 5 years and produce 600,000 units over the 5 years. The equipment was expected to have a salvage value of $50,000. In 2003, Mira produced 100,000 units and sold 90,000 units.

Problem 1: Prepare the journal entry to record the acquisition of the equipment on January 1, 2003.

Problem 2: Prepare the journal entry to record the amortization expense for the year 2003 using the units-of-production method.

Reference no: EM132755406

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