Question

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 the above dates, including entries to update depreciation, where applicable, on disposed assets. The company uses straight-line depreciation. All depreciation was up to date as of December 31, 2021. (Credit account titles are automatically indented when the 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.

To record depreciation expense on forklift

to record sale of forklift

To record depreciation expense on truck

To record sale of truck

Homework Answers

Answer #1
Date Account title Debit Credit
Jun-30 Depreciation expense ($33,000/5*6/12) $     3,300
Accumulated depreciation - Forklift $     3,300
Jun-30 Cash $   12,300
Accumulated depreciation - Forklift ($33,000/5*3)+$3,300) $   23,100
Forklift $   33,000
Gain on sale of equipment $     2,400
Dec-31 Depreciation expense (($39,400-$3,000)/8) $     4,550
Accumulated depreciation - Truck $     4,550
Dec-31 Accumulated depreciation - Truck (($39,400-$3,000)/8*6) $   27,300
Loss on discard of asset $   12,100
Truck $   39,400

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