Answer:
a. Debit Depreciation expense account (p/l) $4,320
Cr Accumulated depreciation $4,320
Being entries to adjust for depreciation at year end
b. Debit Depreciation expense account (p/l) $360
Cr Accumulated depreciation $360
Being entries to account for monthly depreciation expense.
Explanation:
Depreciation is the systematic allocation of the cost of an asset to the income statement over the estimated useful life of that asset.
It is determined as the depreciable value of the asset over the estimated useful life of the asset where the depreciable value is the difference between the cost and salvage value of the asset
Mathematically,
Depreciation = (Cost - Salvage value)/Estimated useful life
To record depreciation expense,
Debit Depreciation expense account (p/l)
Cr Accumulated depreciation
From the given information,
Monthly depreciation = $4,320/12
= $360
