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A Hotel and Country Club Bought a Lawn Mower on 1st

Question 23

Multiple Choice

A hotel and country club bought a lawn mower on 1st January 2012 for $10,000. It has been estimated that the lawn mower will be sold off for a salvage value of $2,000 after four years. If the hotel uses the straight line depreciation method, what is the accounting entry to record the lawn mower's depreciation for the hotel's year ending 31 March 2012:


A) Debit Accumulated Depreciation $625; Credit Depreciation Expense $625.
B) Debit Depreciation Expense $625; Credit Accumulated Depreciation $625.
C) Debit Depreciation Expense $500; Credit Accumulated Depreciation $500.
D) Debit Accumulated Depreciation $500; Credit Depreciation Expense $500.
E) None of the above.

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