Question

The questions is about chapter 9 (Reporting and Analyzing Long Lived Assets) of accounting by Paul...

The questions is about chapter 9 (Reporting and Analyzing Long Lived Assets) of accounting by Paul Kimmel. Please I need detail explanation of how you know the months eg I see the table (64000-3000)/5x3 the 5 stands for the 5years given in the statement but the month (ie the 3) I don't where it is coming from. this the question

Sunland Company owns equipment that cost $73,000 when purchased on January 1, 2019. It has been depreciated using the straight-line method based on an estimated salvage value of $13,000 and an estimated useful life of 5 years.

Prepare Sunland Company’s journal entries to record the sale of the equipment in these four independent situations. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

(a) Sold for $39,000 on January 1, 2022.
(b) Sold for $39,000 on May 1, 2022.
(c) Sold for $22,000 on January 1, 2022.
(d) Sold for $22,000 on October 1, 2022.

Homework Answers

Answer #1
Depreciation expense per year
(73000-13000)/5
12000
so from Jan 1,2019 to december 31,2021 three year depreciation already charged
Accumulated depreciation 12000*3
36000
book value on jan 1,2022 73000-36000 (cost - accumulated depreciation)
37000
No Account titles & Explanations Debit Credit
a) cash 39,000
Accumulated Depreciation 36000
Gain on disposal 2,000
Equipment 73,000
b) Depreciation expense 4000
Accumulated Depreciaiton 4000
(12000/12)*4
(since sold on May 1 we need to provide depreciation for 4 months)
cash 39,000
Accumulated Depreciation (36000+4000) 40000
Gain on disposal 6,000
Equipment 73,000
c) cash 22,000
Accumulated Depreciation 36000
loss on disposal 15,000
Equipment 73,000
d) Depreciation expense 4000
Accumulated Depreciaiton 4000
cash 22,000
Accumulated Depreciation 40000
loss on disposal 11,000
Equipment 73,000
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Exercise 9-11 Oriole Company owns equipment that cost $70,000 when purchased on January 1, 2019. It...
Exercise 9-11 Oriole Company owns equipment that cost $70,000 when purchased on January 1, 2019. It has been depreciated using the straight-line method based on an estimated salvage value of $10,000 and an estimated useful life of 5 years. Prepare Oriole Company’s journal entries to record the sale of the equipment in these four independent situations. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the...
Equipment was acquired on January 1, 2019 at a cost of $197,000. The equipment was originally...
Equipment was acquired on January 1, 2019 at a cost of $197,000. The equipment was originally estimated to have a salvage value of $12,000 and an estimated life of 10 years. Depreciation has been recorded through December 31, 2021 using the straight-line method. On January 1, 2022, the estimated salvage value was revised to $43,000 and the useful life was revised to a total of 8 years. Prepare the journal entry to record depreciation expense for 2022. (Credit account titles...
Tamarisk, Inc. owns equipment that cost $62,800 when purchased on January 1, 2017. It has been...
Tamarisk, Inc. owns equipment that cost $62,800 when purchased on January 1, 2017. It has been depreciated using the straight-line method based on an estimated salvage value of $4,600 and an estimated useful life of 5 years. Prepare Tamarisk, Inc.’s journal entries to record the sale of the equipment in these four independent situations. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to 0 decimal places, e.g.125. If no entry is required,...
On October 1, 2020, Monty Equipment Company sold a pecan-harvesting machine to Valco Brothers Farm, Inc....
On October 1, 2020, Monty Equipment Company sold a pecan-harvesting machine to Valco Brothers Farm, Inc. In lieu of a cash payment Valco Brothers Farm gave Arden a 2-year, $144,800, 10% note (a realistic rate of interest for a note of this type). The note required interest to be paid annually on October 1. Monty’s financial statements are prepared on a calendar-year basis. Assuming Valco Brothers Farm fulfills all the terms of the note, prepare the necessary journal entries for...
Oriole Company had the following assets on January 1, 2022. Item Cost Purchase Date Useful Life...
Oriole Company had the following assets on January 1, 2022. Item Cost Purchase Date Useful Life (in years) Salvage Value Machinery $74,000 Jan. 1, 2012 10 $ 0 Forklift 33,000 Jan. 1, 2019 5 0 Truck 39,400 Jan. 1, 2017 8 3,000 During 2022, each of the assets was removed from service. The machinery was retired on January 1. The forklift was sold on June 30 for $12,300. The truck was discarded on December 31. Journalize all entries required on...
CC9-1 Accounting for the Use and Disposal of Long-Lived Assets [LO 9-3, LO 9-5] [The following...
CC9-1 Accounting for the Use and Disposal of Long-Lived Assets [LO 9-3, LO 9-5] [The following information applies to the questions displayed below.] Nicole’s Getaway Spa (NGS) purchased a hydrotherapy tub system to add to the wellness programs at NGS. The machine was purchased at the beginning of the year at a cost of $25,000. The estimated useful life was five years and the residual value was $1,000. Assume that the estimated productive life of the machine is 10,000 hours....
Problem 10-5A At December 31, 2017, Grand Company reported the following as plant assets. Land $...
Problem 10-5A At December 31, 2017, Grand Company reported the following as plant assets. Land $ 3,560,000 Buildings $29,090,000 Less: Accumulated depreciation—buildings 12,460,000 16,630,000 Equipment 48,930,000 Less: Accumulated depreciation—equipment 5,430,000 43,500,000     Total plant assets $63,690,000 During 2018, the following selected cash transactions occurred. April 1 Purchased land for $2,000,000. May 1 Sold equipment that cost $1,170,000 when purchased on January 1, 2014. The equipment was sold for $702,000. June 1 Sold land purchased on June 1, 2008 for $1,470,000. The...
PA9-3 Analyzing and Recording Long-Lived Asset Transactions with Partial-Year Depreciation [LO 9-2, LO 9-3, LO 9-6]...
PA9-3 Analyzing and Recording Long-Lived Asset Transactions with Partial-Year Depreciation [LO 9-2, LO 9-3, LO 9-6] [The following information applies to the questions displayed below.] Precision Construction entered into the following transactions during a recent year. January 2 Purchased a bulldozer for $268,000 by paying $29,000 cash and signing a $239,000 note due in five years. January 3 Replaced the steel tracks on the bulldozer at a cost of $29,000, purchased on account. The new steel tracks increase the bulldozer's...
Monty Company purchased equipment on January 2, 2013, for $ 105,700. The equipment had an estimated...
Monty Company purchased equipment on January 2, 2013, for $ 105,700. The equipment had an estimated useful life of 5 years with an estimated salvage value of $ 13,200. Monty uses straight-line depreciation on all assets. On January 2, 2017, Monty exchanged this equipment plus $ 13,100 in cash for newer equipment. The old equipment has a fair value of $ 53,300. Prepare the journal entry to record the exchange on the books of Monty Company. Assume that the exchange...
On January 1, 2014, Packard Company purchased an 80% interest in Sage Company for $592,700. On...
On January 1, 2014, Packard Company purchased an 80% interest in Sage Company for $592,700. On this date Sage Company had common stock of $145,700 and retained earnings of $370,900. Sage Company’s equipment on the date of Packard Company’s purchase had a book value of $402,500 and a fair value of $626,775. All equipment had an estimated useful life of 10 years on January 2, 2009. Prepare the December 31 consolidated financial statements workpaper entries for 2014 and 2015 to...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT