The following transactions occurred during 2017, Assume that depreciation of 10%

Question

The following transactions occurred during 2017, Assume that depreciation of 10% per year is charged on all machinery and 5% per year on buildings, on a straight-line basis, with no estimated salvage value. Depreciation is charged for a full year on all fixed assets acquired during the year, and no depreciation is charged on fixed assets disposed of during the year an. 30 A building that cost $168,960 in 2000 is torn down to make room for a new building. The wrecking contractor was paid $6,528 and was permitted to keep all materials salvaged Mar. 10 Machinery that was purchased in 2010 for $20,480 is sold for $3,712 cash, f.?.b. purchaser's plant. Freight of $384 is paid on the sale of this machinery Mar. 20 A gear breaks on a machine that cost $11,520 in 2009. The gear is replaced at a cost of $2,560. The replacement does not extend the useful life of the achine but does make the machine more efficient. May 18 A special base installed for a machine in 2011 when the machine was purchased has to be replaced at a cost of $7,040 because of defective workmanship on the original base. The cost of the une 23 One of the buildings is repainted at a cost of $8,832. It had not been painted since it was constructed in 2013. Prepare general journal entries for the transactions. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No machinery was $18,176 in 2011. The cost of the base was $4,480, and this amount was charged to the Machinery account in 2011 Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation 1/30 Debit Credit umulated Depreciation-Buildin ss on Disposal of Buildin ? ? 3/10 umulated Depreciation-Machiner ss on Disposal of Machiner achiner hiner

Explanation / Answer

Date Accounts title Dr Cr 1/30 Accumulated depreciation-Building [5%*168960 * 17 years] 143616 Loss on disposal of building 31872 To Building 168960 To cash 6528 3/10 Cash [3712-384] 3328 Accumulated depreciation-Machinery [10%*20480 * 7 years] 14336 Loss on disposal of Machinery 2816 To Machinery 20480 3/20 Machinery 2560 To cash 2560 5/18 Machine 7040 Accumulated depreciation-Machinery [10% * 4480 * 6 years] 2688 Loss on disposal of Machinery 1792 To Machine 4480 To cash 7040 6/23 Maintenance and repairs expense 8832 To cash 8832

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