Determine the amount of depreciation expense

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Reference no: EM132785914

Questions -

Situation 1: Ducharme Corporation purchased electrical equipment at a cost of $12,400 on June 2, 2017. From 2017 through 2020, the equipment was depreciated on a straight-line basis, under the assumption that it would have a 10-year useful life and a $2,400 residual value. After more experience and before recording 2021's depreciation, Ducharme revised its estimate of the machine's useful life downward from a total of 10 years to 8 years, and revised the estimated residual value to $2,000.

On April 29, 2022, after recording part of a year's depreciation for 2022, the company traded in the equipment on a newer model, and received a $4,000 trade-in allowance, even though the equipment's fair value was only $2,800. The new asset had a list price of $15,300 and the supplier accepted $11,300 cash for the balance. The new equipment was depreciated on a straight-line basis , assuming a seven-year useful life and a $1300 residual value.

For situation 1, determine the amount of depreciation expense reported by Ducharme for each fiscal year for the years ending December 31, 2017 to December 31, 2022 and also want accounting entry.

Reference no: EM132785914

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