nasoff company operates a small manufacturing facility as a supp 253415

Nasoff Company operates a small manufacturing facility as a supplement to its regular service activities. At the beginning of 2011, an asset account for the company showed the following balances:

Manufacturing equipment …………………… $100,000

Accumulated depreciation through 2010 ……… 54,000

During 2011, the following expenditures were incurred for the equipment:

Routine maintenance and repairs on the equipment ………………………….….. $ 1,000

Major overhaul of the equipment that improved efficiency on January 2, 2011 … 12,000

The equipment is being depreciated on a straight-line basis over an estimated life of 15 years with a $10,000 estimated residual value. The annual accounting period ends on December 31.

Required:

1. Give the adjusting entry that was made at the end of 2010 for depreciation on the manufacturing equipment.

2. Starting at the beginning of 2011, what is the remaining estimated life?

3. Give the journal entries to record the two expenditures during 2011.

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