Sesame Company

Truck acquisition price 80,000,000

Residual value 10,000,000
Estimated usage (Miles) 250,000 miles
Useful life (years) 8 years
Usage during the year
2018 50,000 miles
2019 20,000 miles

Depreciation Expense
a. Straight line method SLM Depreciation Expense = (acquisiton price - residual value/est. useful life

8,750,000 depreciation expense for every year

31-Dec-18 Dr. Depr Expense

Cr. Accumulated Depreciation
31-Dec-19 Dr. Depr Expense
Cr. Accumulated Depreciation

b. Units of activity Unit of Activity Depreciation Expense = (acquisiton price - residual value) *(u

31-Dec-18 Dr. Depr Expense

Cr. Accumulated Depreciation
31-Dec-19 Dr. Depr Expense
Cr. Accumulated Depreciation

c. Double Declining Method DDM Depreciation Expense = (remaining book value )*(rate DDM) ==> resid

Rate SLM 12.5%

Rate DDM 25% > (Rate SLM * 2)
 Acquisition Price 80,000,000
Year Rate DDM Depr. Expense Accumulated Depreciation Remaining book value
1 2018 25% 20,000,000 20,000,000 60,000,000
2 2019 25% 15,000,000 35,000,000 45,000,000
3 2020 25% 11,250,000 46,250,000 33,750,000
4 2021 25% 8,437,500 54,687,500 25,312,500
5 2022 25% 6,328,125 61,015,625 18,984,375
6 2023 25% 4,746,094 65,761,719 14,238,281
7 2024 25% 3,559,570 69,321,289 10,678,711
8 2025 25% 678,711 70,000,000 10,000,000

31 Dec, 2018 Dr. Depr Expense 20,000,000

Cr. Accumulated Depreciation 20,000,000
31 Dec, 2019 Dr. Depr Expense 15,000,000
Cr. Accumulated Depreciation 15,000,000

b. Sesame Company
Balance Sheet, SLM Method
As of December 31, 2018

Assets
Delivery truck 80,000,000
Less accumulated depreciation (8,750,000)
Delivery truck (net) 71,250,000
rice - residual value/est. useful life)

8,750,000
8,750,000
8,750,000
8,750,000

quisiton price - residual value) *(usage for the year/est. usage of asset in miles)

14,000,000
14,000,000
5,600,000
5,600,000

ook value )*(rate DDM) ==> residual value is taken into account at the very end of year of use for this method
book value ending senilai residual value, depreciation expense periode tersebut disesuaikan
1 Rona Co.
Price of Old Truck 45,000,000
Accum. Depreciation 10,000,000
Cash Additions 15,000,000
Fair Value of Old Truck 38,000,000

Journals
Dr. New Truck 53,000,000 For this type of exchange, there are two things to calcu
Dr. Accumulated Depreciation 10,000,000 New truck price: money paid
Cr. Gain on Exchange 3,000,000 Gain/loss: comparison of old
Cr. Old Truck 45,000,000
Cr. Cash 15,000,000

2 Black Inc.
Price of Old Machinary 15,000,000
Accum. Depreciation 3,000,000
Cash Additions 8,000,000
Fair Value of Old Machinary 10,000,000

Jurnal
Dr. New Machine 18,000,000
Dr. Accumulated Depreciation 3,000,000 New machinary price: mone
Dr. Loss on Exchange 2,000,000 Gain/loss: comparison of old
Cr. Old Machine 15,000,000
Cr. Cash 8,000,000
ere are two things to calculate: 1) price of new truck and 2) gain/loss from transactions
ew truck price: money paid + fair value of old truck 53,000,000
in/loss: comparison of old truck Book value to new truck price 3,000,000

ew machinary price: money paid + fair value of old truck 18,000,000

in/loss: comparison of old truck Book value to new truck price (2,000,000)
1. Journal entries for PT Poci in 2019
Land & Capitalized Expenditures
Purchase Price 2,500,000,000
Commission fee 125,000,000
Legal fee 50,000,000
Related tax 50,000,000
Removal of old building costs 30,000,000
Proceeds from salvage materials (10,000,000)
2,745,000,000

Date Description Dr. Cr.

1-Jan-18 Land acquisition Land
Cash
1-Jan-19 Building Construction Building
Cash
31-Mar-19 Machine purchase Machine
Cash
1-Jul-19 Vehicle purchase Vehicle
Cash

2. Depreciation Expense for 2019 and Entries for 31 Dec 2019

1 Land No depreciation / No entry

2 Building 2,000,000,000
useful life 15 year
residual value 500,000,000
SLM
depre/year 100,000,000

Depreciation Expense - Building

Accumulated Depreciation - Building
 3 Machine 1,000,000,000
capacity 1,600,000 Units for two machines
residual value -

Actual unit produce year 1 200,000

depre expense 2019 125,000,000

Depreciation Expense - Machine

Accumulated Depreciation - Machine

4 vehicle 300,000,000
Useful life 5
residual value 90,000,000
DDM 40%
Rate
depre year 1 120,000,000 40%
depre jul-dec 60,000,000

Depreciation Expense - Vehicle

Accumulated Depreciation - Vehicle

3. Revising useful life

>> No entry
Change of assumptions (umur manfaat, nilai sisa, metode depresiasi) --> prospective, doesn't change the previous (2019) accounting record

Depre Expense 2020 - building

Building 2,000,000,000
Accm. Depre (100,000,000)
Carrying amount 1,900,000,000
remaining useful life 24
residual value 500,000,000
Depre Expense 2020 - building 58,333,333
4. Disposal of asset - Vehicle
Depre expense 1 jan - 1 jul 2020
Depreciation Expense - Vehicle
Accumulated Depreciation - Vehicle

Vehicle 100,000,000
Accm. Depre (36,000,000)
Carrying amount 64,000,000

Acc. Depreciation - Vehicle 36,000,000

Loss on Asset Disposal 64,000,000
Vehicle

Depreciation Table for 3 Vehicles, Double Declining Method

Depreciation FOR 3 Vehicles @ 100.000.000 each => 300jt

Year Rate DDM

1 juli 2019
0.5 31 Desember 2019 40%
1 31 Desember 2020 40%
2 31 Desember 2021 40%
3 31 Desember 2022 40%
4 31 Desember 2023 40%
0.5 1 Juli 2024 40%
 Capitalized costs: Any costs directly attributable to bringing the asset to the location and condition

2,745,000,000
2,745,000,000
2,000,000,000
2,000,000,000
1,000,000,000
1,000,000,000
300,000,000
300,000,000

(land is not depreciated)

100,000,000
 for both machines
(total actual units produced/total capacity*machines bv)

125,000,000
125,000,000

(100jt x 3)
year
(30jt x 3)

300,000,000

60,000,000
60,000,000

e the previous (2019) accounting records

years

Record at the end of 2020 year period

 16,000,000
16,000,000

(1 vehicle)

--> Loss on disposal

100,000,000

RV = 10*3 = 30jt

Depre exp Acc Depre

60,000,000 60,000,000
96,000,000 156,000,000
57,600,000 213,600,000
34,560,000 248,160,000
20,736,000 268,896,000
1,104,000 270,000,000
directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

100,000,000
14 remaining years + 10 additional years due to revision of estimated use
= 30jt

Remaining BV
300,000,000
240,000,000
144,000,000
86,400,000
51,840,000
31,104,000
30,000,000
be capable of operating in the manner intended by management.
6/12*BV Beginning of year x Rate 40%
BV of 1 Vehicle in 1 Jan 2020=100.000-20.000=80.000

untuk 3 vehicle