Question

hina and Analyzing Long-Lived Assets 9-46 CHAPTER 9 Reporting and Analyzing Long-Lived Assets Journalise equipment tractors and to purchase ett and duration Excel POJA (LO 2,3,5), AP At December 31, 2022, Arnold Corporation reported the following plant Land $ 3,000,000 Buildings $26.500,000 Less: Accumulated depreciation-buildings 11.925,000 14,575.000 Equipment 40,000,000 Less: Accumulated depreciation equipment 5,000,000 35.000.000 Total plant assets $52,575.000 During 2023, the following selected cash transactions occurred. Apr. 1 Purchased land for $2.200,000. May 1 Sold equipment that cost $600,000 when purchased on January 1, 2016. The equipment was sold for $170,000 June 1 Sold land for $1,600,000. The land cost $1.000.000 July 1 Purchased equipment for $1,100,000. Dec. 31 Retired equipment that cost $ 700,000 when purchased on December 31, 2013. No salvage value was received. Instructions a. Journalize the transactions. (Hint: You may wish to set up T-accounts, post beginning balances, and then post 2023 transactions.) Amold uses straight-line depreciation for buildings and equipment The buildings are estimated to have a 40-year useful life and no salvage value; the equipment is esti- mated to have a 10-year useful life and no salvage value. Update depreciation on assets disposed of at the time of sale or retirement. b. Record adjusting entries for depreciation for 2023. c. Prepare the plant assets section of Arnold's balance sheet at December 31, 2023. Tot plant assets $50,037,500

Answer 1

To the books of Arnold corporation Journal Entries Particulars Debit Credit Date Lolloy 2200000 allos hand Ale or 2200000 - To Cash (Being land purchased) Depreciation Exp Alor 20000 To Accum. Depreciation O equipment (Being depreciation recorded GO0000 - 60000 x 20000 10 600000 TO000 Cash Ale Dr 40000 Accum. Dep. Equip Ale Dr 440000 - To equipment To Gain on sale - of equipment (Sale of equipment) ( Coooox4.420006 +20000 = 440000 Cash Dr aloo - 1600000 To To Al land Gain 1000000 600.000 on sale of land oilor equipment Ale Dr 1100000 - To Cash (Being equipment purchased) 1100000

f0000 Depreciation Expense ale Dr 40000 To Accumulated dep - (equipment (Being depreciation recorded) 700000/10 - 70000 Acumulated depreciation Al Dr 630000 loss on disposal al or 70000 To Equipment (Being equipment retired) 70000 x 8- 560000 +70000 100000 - 630000 Adjusting 31/12 3925000 Entries Depreciation expense te or 392000 - To Accomulated depreciation (Being dep recorded 40000000 – 600000 - 400000 ___ -38700.000 /0 - 380000 1100000110 - 110000 31/12 Depreciation expense ale Dr 662500 To Acum Depreciation (Building [Being depreciation recorded) ( 26500000% = 662500

Balance sheet As at 31.12.23 - Partial 41200000 Assets land Buildings Accum depreciation Building 26 20000 (1258 +500) 13912500 Equipment 39800000 Accom depreciat (7855000) Equipment 31945ooo 50054500