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4-7. On July,1 2010, Dexter Corp. buys a computer system for $260,000 in cash. Assume that the computer is expected to have a four-year life and an estimated salvage value of $20,000 at the end of that time. Prepare the journal entry to record the purchase of the computer on July 1, 2010. Compute the depreciable cost of the computer. Using the straight-line method, compute the monthly depreciation. Prepare the adjusting entry to record depreciation at the end of July, 2010. Compute the computer’s carrying value that will be shown on Dexter’s balance sheet prepared on December 31.
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