Question

Bramble Company purchased equipment for $31200 on December 1. It is estimated that annual depreciation on the equipment will be $7800. If financial statements are to be prepared on December 31, the company should make the following adjusting entry:

A) Debit Equipment, $31200; Credit Accumulated Depreciation, $31200.
B) Debit Depreciation Expense, $650; Credit Accumulated Depreciation, $650.
C) Debit Depreciation Expense, $23400; Credit Accumulated Depreciation, $23400.
D) Debit Depreciation Expense, $7800; Credit Accumulated Depreciation, $7800.

Answer 1

The correct adjusting entry for Bramble Company to record annual depreciation on the purchased equipment is: Debit Depreciation Expense, $7800; Credit Accumulated Depreciation, $7800.

Step-by-step explanation:

The correct adjusting entry for Bramble Company to record annual depreciation on the purchased equipment is:

Debit Depreciation Expense, $7800

Credit Accumulated Depreciation, $7800

This entry recognizes the expense of depreciation and simultaneously increases the accumulated depreciation account.