Long Term Assets

In this section, the questions asked will be specific to time. Explain

In other words, one would have to calculate depreciation for a long-term asset for a month or two, or a year or two because it will be sold. Also one will write the journal entries correlated to the asset sale.
how do we calculate the depreciation of a natural resource asset?

it is only calculated using the units method.
What is depreciation called in a natural resource asset?

Depletion
what are the journal entries for depletion?

Depletion Expense #

Accumulated Depletion #
Explain the indication if the plug is a debit/ credit

Debit = loss

credit = gain
Define warranties

a promise from a company to a customer to repair or replace a product under certain circumstances ( ex: defective product)

warranties are liabilities
When is the warranty liability created?

the warranty and liability and expense are both recognized at the time of the product's sale
what are the warranty journal entries at the time of sale?

warranty expense #

warranty liability #
what are the warranty journal entries after repairs are made?

warranty liability #

cash/ accounts payable, etc #
how does the warranty liability t chart look like?

Bal at begining of year #

repairs #

Warranty expense #.

Balance at the end of the year #

when an item is sold and one needs to incorporate the months with a fraction what method does not need a fraction?

units method