Question 5 Date Account Titles and Explanation Debit Credit (To record depreciat
ID: 2401557 • Letter: Q
Question
Question 5
Date
Account Titles and Explanation
Debit
Credit
(To record depreciation)
May 1
(To record sale of equipment)
(To record depreciation)
(To record retirement of equipment)
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Date
Account Titles and Explanation
Debit
Credit
(To record building depreciation)
(To record equipment deprecition)
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Question 5
At December 31, 2017, Grand Company reported the following as plant assets.Land $ 4,180,000 Buildings $27,310,000 Less: Accumulated depreciation—buildings 12,890,000 14,420,000 Equipment 47,470,000 Less: Accumulated depreciation—equipment 4,530,000 42,940,000 Total plant assets $61,540,000
During 2018, the following selected cash transactions occurred.
April 1 Purchased land for $2,060,000. May 1 Sold equipment that cost $1,050,000 when purchased on January 1, 2014. The equipment was sold for $630,000. June 1 Sold land purchased on June 1, 2008 for $1,520,000. The land cost $400,000. July 1 Purchased equipment for $2,540,000. Dec. 31 Retired equipment that cost $494,000 when purchased on December 31, 2008. No salvage value was received.
Explanation / Answer
1) Journal Entries (Amounts in $)
2) Adjusting Entries for depreciation (Amounts in $)
3) Grand Company
Balance Sheet (Partial)
For the year ended December 31, 2018 (Amounts in $)
Date Account Titles and Explanation Debit Credit Apr. 1 Land 2,060,000 Cash 2,060,000 May 1 Depreciation expense (1,050,000/10 yrs*4/12) 35,000 Accumulated depreciation-equipment 35,000 (To record depreciation) May 1 Cash 630,000 Accumulated depreciation-equipment [(105,000*4 yrs)+35,000] 455,000 Gain on sale of equipment (Bal Fig) (630,000+455,000-1,050,000) 35,000 Equipment 1,050,000 (To record sale of equipment) June 1 Cash 1,520,000 Gain on sale of land (Bal Fig) (1,520,000-400,000) 1,120,000 Land 400,000 July 1 Equipment 2,540,000 Cash 2,540,000 Dec. 31 Depreciation expense (494,000/10 yrs) 49,400 Accumulated depreciation-equipment 49,400 (To record depreciation) Dec. 31 Accumulated depreciation-equipment (49,400*10 yrs) 494,000 Equipment 494,000 (To record retirement of equipment)Related Questions
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