Question

On December 31, 2020, Coronado Inc. has a machine with a book value of $1,052,800. The...

On December 31, 2020, Coronado Inc. has a machine with a book value of $1,052,800. The original cost and related accumulated depreciation at this date are as follows.

Machine

$1,456,000

Less: Accumulated depreciation

403,200

Book value

$1,052,800


Depreciation is computed at $67,200 per year on a straight-line basis.

Presented below is a set of independent situations. For each independent situation, indicate the journal entry to be made to record the transaction. Make sure that depreciation entries are made to update the book value of the machine prior to its disposal.A fire completely destroys the machine on August 31, 2021. An insurance settlement of $481,600 was received for this casualty. Assume the settlement was received immediately. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Date

Account Titles and Explanation

Debit

Credit

August 31, 2021

enter an account title to record current depreciation

enter a debit amount

enter a credit amount

enter an account title to record current depreciation

enter a debit amount

enter a credit amount

(To record current depreciation.)

August 31, 2021

enter an account title to record loss of the machine

enter a debit amount

enter a credit amount

enter an account title to record loss of the machine

enter a debit amount

enter a credit amount

enter an account title to record loss of the machine

enter a debit amount

enter a credit amount

enter an account title to record loss of the machine

enter a debit amount

enter a credit amount

(To record loss of the machine.)

On April 1, 2021, Coronado sold the machine for $1,164,800 to Yoakam Company. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Date

Account Titles and Explanation

Debit

Credit

April 1, 2021

enter an account title to record current depreciation

enter a debit amount

enter a credit amount

enter an account title to record current depreciation

enter a debit amount

enter a credit amount

(To record current depreciation.)

April 1, 2021

enter an account title to record sale of the machine

enter a debit amount

enter a credit amount

enter an account title to record sale of the machine

enter a debit amount

enter a credit amount

enter an account title to record sale of the machine

enter a debit amount

enter a credit amount

enter an account title to record sale of the machine

enter a debit amount

enter a credit amount

(To record sale of the machine.)

On July 31, 2021, the company donated this machine to the Mountain King City Council. The fair value of the machine at the time of the donation was estimated to be $1,232,000. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Date

Account Titles and Explanation

Debit

Credit

July 31, 2021

enter an account title to record current depreciation

enter a debit amount

enter a credit amount

enter an account title to record current depreciation

enter a debit amount

enter a credit amount

(To record current depreciation.)

July 31, 2021

enter an account title to record donation of the machine

enter a debit amount

enter a credit amount

enter an account title to record donation of the machine

enter a debit amount

enter a credit amount

enter an account title to record donation of the machine

enter a debit amount

enter a credit amount

enter an account title to record donation of the machine

enter a debit amount

enter a credit amount

(To record donation of the machine.)

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Answer #1

Solution Account ttes and explanedton Date Gredat Delit Depeciaton epese Aug 1,21 44800 Accumulated depreclatton C67200 /12 XAccount teerplanatn Gude Date Delbit beprectation espense t-Apr 21 t6800 Accumulated deprectedtom 16800 C67200x 3/12) $/31/2145b000 Machtne Account ite & explanaton Grede t Debit Date 31200 Deprectastion erpense 31-Tul-21 Accumulated deprect ation 39

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