Question

Here are selected 2017 transactions of Cheyenne Corporation.

Jan. 1		Retired a piece of machinery that was purchased on January 1, 2007. The machine cost $62,600 and had a useful life of 10 years with no salvage value.
June 30		Sold a computer that was purchased on January 1, 2015. The computer cost $36,400 and had a useful life of 4 years with no salvage value. The computer was sold for $4,400 cash.
Dec. 31		Sold a delivery truck for $9,200 cash. The truck cost $25,000 when it was purchased on January 1, 2014, and was depreciated based on a 5-year useful life with a $3,700 salvage value.

Prepare a tabular summary to record all transactions described on the above dates. Update depreciation on assets disposed of, where applicable. Cheyenne Corporation uses straight-line depreciation. (If a transaction causes a decrease in Assets, Liabilities or Stockholders' Equity, place a negative sign (or parentheses) in front of the amount entered for the particular Asset, Liability or Equity item that was reduced.)

(Not a credit/ debit Problem): Just Tabular Analysis

Answer 1

Date	Assets			Liabilities	Stockholders' Equity
	Cash	Equipment	Accumulated Depreciation - Equipment			Hint:
Jan 1		$       (62,600)	$       (62,600)
June 30	$        4,400	$       (36,400)	$       (22,750)		$       (13,800)	(-9250-4550)
Dec 31	$        9,200	$       (25,000)	$       (17,040)		$         (3,020)	(-4260+1240)

Hint:

Computer at cost	$         36,400
Less: Salvage value	$                    0
Depreciable cost	$         36,400
Divided by: Useful life	4
Depreciation expense per year	$            9,100
Computer at cost	$         36,400
Less: Accumulated Depreciation for 2 years (2015 and 2016) (9100*2)	$         18,200
Book value of compauter at end of 2016	$         18,200
Book value of compauter at end of 2016	$         18,200
Less: current period's depreciation expense	$            4,550
Book value of compauter at June 30, 2017	$         13,650
Less: Comuter sold	$            4,400
Loss on sale of assets	$            9,250

Delivery truck at cost	$ 25,000
Less: Salvage value	$    3,700
Depreciable cost	$ 21,300
Divided by: Useful life	5
Depreciation expense per year	$    4,260
Delivery truck at cost	$ 25,000
Less: Accumulated Depreciation for 3 years (2014, 2015 and 2016) (4260*3)	$ 12,780
Book value of Delivery truck at end of 2016	$ 12,220
Book value of Delivery truck at end of 2016	$ 12,220
Less: current period's depreciation expense	$    4,260
Book value of Delivery truck at June 30, 2017	$    7,960
Less: Delivery truck sold	$    9,200
Loss(Gain) on sale of assets	$ (1,240)

Company name
Journal entries
Date	General Journal	Debit	Credit
Jan 1	Accumulated Depreciation - Equipment	62,600
	Equipment		62,600
	(To record Retired a piece of machinery.)
June 30	Depreciation expense	4,550
	Accumulated Depreciation - Equipment		4,550
	(To record depreciation expense on Computer sold.) (Jan to June = 6 months) (9100*6/12)
June 30	Cash	4,400
	Accumulated Depreciation - Equipment (18200+4550)	22,750
	Loss on sale of Equipment	9,250
	Equipment		36,400
	(To record sales of computer.)
Dec 31	Depreciation expense	4,260
	Accumulated Depreciation - Equipment		4,260
	(To record depreciation expense on Delivery truck sold.)
Dec 31	Cash	9,200
	Accumulated Depreciation - Equipment (12780+4260)	17,040
	Gain on sale of Equipment		1,240
	Equipment		25,000
	(To record sales of Delivery truck .)