Problem #3, (10 points) Prepare the journal entries to record the following tran
ID: 2394137 • Letter: P
Question
Problem #3, (10 points) Prepare the journal entries to record the following transactions for the Sysco Company, which has a year end and uses the straight-line method of depreciation. calendar (a) On June 30, 2017 the company sold old office equipment for $18,000. The office equipment originally (b) On September 30, 2017, Sysco Company sold old delivery equipment for $9,000. The delivery equipment was purchased on January 1,2015, for $19,000 and was estimated to have a $4,000 salvage value at the end of its S-year life. Depreciation on the delivery equipment has been recorded through December 31, 2016. Prepare the journal entries to record the depreciation expense and sale of asset. Date June 30 Account Titles and Explanation Debit To record sale of office equipment Sept. 30 To record depreciation Sept 30 To record sale of delivery equipmentExplanation / Answer
Journal Entries
Date
Particulars
Dr
Cr
June 30
2017
Depreciation A/c dR
To Office Equipment A/c
10000
10000
June 30
2017
Bank A/c Dr
To Office Equipment A/c (WDV)
To Profit On Sale Of office Equipment
18000
14000
4000
Sep 30
Depreciation A/c dr (working Notes)
To DeliverY Equipment A/c
2250
2250
Sep 30
Bank A/c Dr
Loss on sale Of Equipment
To Delivery Equipment A/c (wdv)
9000
3750
12750
Working Notes
Calculation Of profit & Loss Onm sale Of office Equipment
Original Value 24000
Less Depreciation 10000
Written Down Value 14000
Sale 18000
Profit On Sale 4000
Calcualation Of depreciation of delivery Equipment
Depreciation = original value – scrap value/ no of useful years
19000-4000/5
3000
Depreciation For 9 months 3000*9/12=2250
Calculation Of profit & Loss On sale Of Delivery Equipment Equipment
Original Value 15000
Less Depreciation 2250
Written Down Value 12750
Sale 9000
Loss On Sale 3750
Date
Particulars
Dr
Cr
June 30
2017
Depreciation A/c dR
To Office Equipment A/c
10000
10000
June 30
2017
Bank A/c Dr
To Office Equipment A/c (WDV)
To Profit On Sale Of office Equipment
18000
14000
4000
Sep 30
Depreciation A/c dr (working Notes)
To DeliverY Equipment A/c
2250
2250
Sep 30
Bank A/c Dr
Loss on sale Of Equipment
To Delivery Equipment A/c (wdv)
9000
3750
12750
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