A company purchased a heating system on January 2,1997,for $225,000.The system had an estimated useful life of 15 years.On January 3,2010,the company completed a renovation of the system that cost of $33,000 and now expects the system to be more efficient to last 8 years beyond the original estimate.The company uses the straight-line method of depreciation.
(a)Prepare the journal entry at January 3,2010,to record the renovation of the heating system.
(b)Prepare the journal entry at December 31,2010,to record the depreciation for 2010.

Question

Quizplus · Accepted Answer

The Answer of A company purchased a heating system on January 2,1997,for $225,000.The system had an estimated useful life of 15 years.On January 3,2010,the company completed a renovation of the system that cost of $33,000 and now expects the system to be more efficient to last 8 years beyond the original estimate.The company uses the straight-line method of depreciation.
(a)Prepare the journal entry at January 3,2010,to record the renovation of the heating system.
(b)Prepare the journal entry at December 31,2010,to record the depreciation for 2010.

A Company Purchased a Heating System on January 2,1997,for $225,000