Question

AWL bought furniture costing $180,000 on May 31, 20X1. It has no residual value, a useful...

AWL bought furniture costing $180,000 on May 31, 20X1. It has no residual value, a useful life of 5 years and the company is depreciating it on a straight-line basis. Some shelving that cost $36,000 (included in this furniture amount), was traded in on December 1. In exchange for the old shelving, the company received new shelving that normally retails for $44,000. The company paid no cash was doing this trade.

What would be the journal entries for this transaction?

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1
Cost of old Shelve 36000
Depreciation till Dec1 3600
(36000 /5 *1/2)
Book value of Old shelve 32400
Fair value of New shelve 44000
Gain on exchange of asset 11600
Journal entries
Depreciation-Furniture Account Dr. 3600
     Accumulated depreciation Account 3600
New Furniture Account Dr. 44000
Accumulated dep Account Dr. 3600
     Old Furniture Account 36000
     Gain on exchange of assets 11600
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
On December 31, 2020, Culver Inc. has a machine with a book value of $958,800. The...
On December 31, 2020, Culver Inc. has a machine with a book value of $958,800. The original cost and related accumulated depreciation at this date are as follows. Machine $1,326,000 Less: Accumulated depreciation 367,200 Book value $958,800 Depreciation is computed at $61,200 per year on a straight-line basis. Presented below is a set of independent situations. For each independent situation, indicate the journal entry to be made to record the transaction. Make sure that depreciation entries are made to update...
You have been assigned to examine the financial statements of PC corp. for the year ended...
You have been assigned to examine the financial statements of PC corp. for the year ended December 31, 2019, as prepared following IFRS. You discover the following situations: Physical inventory count on Dec31, 2018, improperly excluded merchandise costing $13,000 that had been temporarily stored in a public warehouse. PC uses periodic inventory system Physical inventory count on Dec31,2019, improperly included merchandise with a cost of $26,000 that had been recorded as a sale on Dec27, 2019, and was being held...
Post-Closing Trial Balance December 31, 2018 Debit Credit Cash      18,200 Accounts receivable        3,960 Supplies        1,380
Post-Closing Trial Balance December 31, 2018 Debit Credit Cash      18,200 Accounts receivable        3,960 Supplies        1,380 Prepaid insurance           750 Prepaid rent        3,800 Furniture        5,000 Accumulated depreciation, furniture           450 Equipment        8,000 Accumulated depreciation, equipment        4,000 Accounts payable        2,700 Accrued liabilities           190 Unearned service revenue        1,900 Common shares      20,000 Retained earnings      11,850 Total      41,090      41,090 PREPARE JOURNAL ENTRIES (+ADJUSTING ONES IF NEEDED) Business Activities for January, 2019 On January 4, 2019, Linda paid the outstanding accounts payable balance from December 31, 2018. On...
On December 31, 2020, Martinez Inc. has a machine with a book value of $1,391,200. The...
On December 31, 2020, Martinez Inc. has a machine with a book value of $1,391,200. The original cost and related accumulated depreciation at this date are as follows. Machine $1,924,000 Less: Accumulated depreciation 532,800 Book value $1,391,200 Depreciation is computed at $88,800 per year on a straight-line basis. Presented below is a set of independent situations. For each independent situation, indicate the journal entry to be made to record the transaction. Make sure that depreciation entries are made to update...
On December 31, 2017, Cullumber Inc. has a machine with a book value of $ 1,222,000....
On December 31, 2017, Cullumber Inc. has a machine with a book value of $ 1,222,000. The original cost and related accumulated depreciation at this date are as follows. Machine $ 1,690,000 Less: Accumulated depreciation 468,000 Book value $ 1,222,000 Depreciation is computed at $ 78,000 per year on a straight-line basis. Presented below is a set of independent situations. For each independent situation, indicate the journal entry to be made to record the transaction. Make sure that depreciation entries...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT