Question

Blue Spruce Corporation owns equipment that cost $73,200 when purchased on April 1, 2013. Depreciation has...

Blue Spruce Corporation owns equipment that cost $73,200 when purchased on April 1, 2013. Depreciation has been recorded at a rate of $12,200 per year, resulting in a balance in accumulated depreciation of $57,950 at December 31, 2017. The equipment is sold on July 1, 2018, for $14,640.

Prepare journal entries to (a) update depreciation for 2018 and (b) record the sale. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

(a) Update depreciation for 2018

Particulars Debit Credit
Depreciation ($12,200*6/12) from 1/01/2018 to 30/06/2018 for 6 months $6100
Accumulated depreciation $6100

(b) To record the sale

Particulars Debit Credit
Cash(Sale value) $14,640
Accumulated depreciation -till date of sale ($57,950+$6100) $64,050
Gain on sale of equipment ($14640+$64,050-$73200) $5,490
Equipment (Cost) $73,200

Gain on sale of equipment = Sale value -Book value of equipment

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Wildhorse Corporation owns machinery that cost $21,600 when purchased on July 1, 2014. Depreciation has been...
Wildhorse Corporation owns machinery that cost $21,600 when purchased on July 1, 2014. Depreciation has been recorded at a rate of $2,592 per year, resulting in a balance in accumulated depreciation of $9,072 at December 31, 2017. The machinery is sold on September 1, 2018, for $11,340. Prepare journal entries to (a) update depreciation for 2018 and (b) record the sale. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required,...
Equipment that cost $416,500 and has accumulated depreciation of $315,100 is exchanged for equipment with a...
Equipment that cost $416,500 and has accumulated depreciation of $315,100 is exchanged for equipment with a fair value of $200,000 and $40,000 cash is received. The exchange lacked commercial substance. Calculate the gain to be recognized from the exchange. Gain recognized $ Prepare the entry for the exchange. Show a check of the amount recorded for the new equipment. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit
Equipment that cost $412,900 and has accumulated depreciation of $324,200 is exchanged for equipment with a...
Equipment that cost $412,900 and has accumulated depreciation of $324,200 is exchanged for equipment with a fair value of $160,000 and $40,000 cash is received. The exchange lacked commercial substance. Calculate the gain to be recognized from the exchange. Gain recognized $ List of Accounts       Prepare the entry for the exchange. Show a check of the amount recorded for the new equipment. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Account...
On July 1, 2017, Blue Corporation purchased Young Company by paying $258,200 cash and issuing a...
On July 1, 2017, Blue Corporation purchased Young Company by paying $258,200 cash and issuing a $146,000 note payable to Steve Young. At July 1, 2017, the balance sheet of Young Company was as follows. Cash $51,400 Accounts payable $205,000 Accounts receivable 90,500 Stockholders’ equity 244,900 Inventory 109,000 $449,900 Land 41,100 Buildings (net) 74,600 Equipment (net) 71,500 Trademarks 11,800 $449,900 The recorded amounts all approximate current values except for land (fair value of $62,200), inventory (fair value of $127,800), and...
resented below is information related to equipment owned by Pearl Company at December 31, 2017. Cost...
resented below is information related to equipment owned by Pearl Company at December 31, 2017. Cost $10,170,000 Accumulated depreciation to date 1,130,000 Expected future net cash flows 7,910,000 Fair value 5,424,000 Assume that Pearl will continue to use this asset in the future. As of December 31, 2017, the equipment has a remaining useful life of 4 years. a. Prepare the journal entry (if any) to record the impairment of the asset at December 31, 2017. (If no entry is...
Presented below is information related to equipment owned by Sheridan Company at December 31, 2017. Cost...
Presented below is information related to equipment owned by Sheridan Company at December 31, 2017. Cost $9,720,000 Accumulated depreciation to date 1,080,000 Expected future net cash flows 7,560,000 Fair value 5,184,000 Assume that Sheridan will continue to use this asset in the future. As of December 31, 2017, the equipment has a remaining useful life of 5 years. a) Prepare the journal entry (if any) to record the impairment of the asset at December 31, 2017. (If no entry is...
Presented below is information related to equipment owned by Whispering Company at December 31, 2017. Cost...
Presented below is information related to equipment owned by Whispering Company at December 31, 2017. Cost $10,350,000 Accumulated depreciation to date 1,150,000 Expected future net cash flows 8,050,000 Fair value 5,520,000 Assume that Whispering will continue to use this asset in the future. As of December 31, 2017, the equipment has a remaining useful life of 4 years. Prepare the journal entry (if any) to record the impairment of the asset at December 31, 2017. (If no entry is required,...
Presented below is information related to equipment owned by Cullumber Company at December 31, 2017. Cost...
Presented below is information related to equipment owned by Cullumber Company at December 31, 2017. Cost $10,890,000 Accumulated depreciation to date 1,210,000 Expected future net cash flows 8,470,000 Fair value 5,808,000 Cullumber intends to dispose of the equipment in the coming year. It is expected that the cost of disposal will be $24,200. As of December 31, 2017, the equipment has a remaining useful life of 4 years. a. Prepare the journal entry (if any) to record the impairment of...
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,...
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...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT