Requirement a: Prepare the following journal entries
Date | Account Title and Explanation | Debit | Credit |
Dec 31 | Accumulated Depreciation - Buildings | $126,000 | |
2019 | Buildings | $126,000 | |
To record elimination of accumulated depreciation on building | |||
Revaluation Gain or Loss ($200,000 − $150,000) | $50,000 | ||
Buildings | $50,000 | ||
To record revaluation loss on buildings | |||
Dec 31 | Accumulated Depreciation - Equipment | $45,000 | |
2019 | Equipment | $45,000 | |
To record elimination of accumulated depreciation on Equipment | |||
Equipment ($108,000 − $80,000) | $28,000 | ||
Revaluation Surplus - OCI | $28,000 | ||
To record revaluation surplus |
Requirement b: Prepare the following journal entries
Date | Account Title and Explanation | Debit | Credit |
Dec 31 | Depreciation Expense ($150,000 ÷ 20 years) | $7,500 | |
2019 | Accumulated Depreciation - Buildings | $7,500 | |
To record depreciation expense on buildings | |||
Equipment ($108,000 ÷ 8 years) | $13,500 | ||
Accumulated Depreciation - Equipment | $13,500 | ||
To record depreciation expense on equipment |
Requirement c: Prepare the following journal entries
Date | Account Title and Explanation | Debit | Credit |
Dec 31 | Accumulated Depreciation - Buildings ($126,000 − $94,500) | $31,500 | |
2019 | Revaluation Gain or Loss ($200,000 − $150,000) | $50,000 | |
Buildings ($31,500 + $50,000) | $81,500 | ||
To record revaluation of buildings | |||
Equipment ($15,750 + $28,000) | $43,750 | ||
Accumulated Depreciation - Equipment($60,750 − $45,000) | $15,750 | ||
Revaluation Surplus - OCI ($108,000 − $80,000) | $28,000 | ||
To record revaluation of equipment |
Notes:
Particulars | Before Revaluation | Proportion | After Revaluation |
Buildings | $326,000 | $150,000 ÷ $200,000 | $244,500 |
Deduct: Accumulated Depreciation | $126,000 | $150,000 ÷ $200,000 | $94,500 |
Carrying Amount | $200,000 | $150,000 ÷ $200,000 | $150,000 |
Equipment | $125,000 | × $108,000 ÷ $80,000 | $168,750 |
Deduct: Accumulated Depreciation | $45,000 | × $108,000 ÷ $80,000 | $60,750 |
Carrying Amount | $80,000 | × $108,000 ÷ $80,000 | $108,000 |
Requirement d: Prepare the following journal entries
Date | Account Title and Explanation | Debit | Credit |
Dec 31 | Depreciation Expense ($150,000 ÷ 20 years) | $7,500 | |
2019 | Accumulated Depreciation - Buildings | $7,500 | |
To record depreciation expense on buildings | |||
Equipment ($108,000 ÷ 8 years) | $13,500 | ||
Accumulated Depreciation - Equipment | $13,500 | ||
To record depreciation expense on equipment |
A partial statement of financial position of Wildhorse Ltd. on December 31, 2019, showed the following...
Exercise 10-25 A partial statement of financial position of Sunland Ltd. on December 31, 2019, showed the following property, plant, and equipment assets accounted for under the cost model (accumulated depreciation includes depreciation for 2019): Buildings Less: accumulated depreciation Equipment Less: accumulated depreciation $346,000 146,000 $200,000 $127,000 47,000 80,000 Sunland uses straight-line depreciation for its building (remaining useful life of 20 years, no residual value) and for its equipment (remaining useful life of 8 years, no residual value). Sunland applies...
Current Attempt in Progress A partial statement of financial position of Ivanhoe Ltd. on December 31, 2019, showed the following property, plant, and equipment assets accounted for under the cost model (accumulated depreciation includes depreciation for 2019): upport Buildings Less: accumulated depreciation Equipment Less: accumulated depreciation $337.000 137.000 $200,000 $125.000 45.000 80.000 Ivanhoe uses straight-line depreciation for its building remaining useful life of 20 years, no residual values and for its equipment remaining useful life of years.no residual value). Ivanhoe...
Oriole Ltd. purchased an electric wax melter on April 30, 2020, by trading in its old gas model and paying the balance in cash. The following data relate to the purchase: List price of new melter Cash paid Cost of old melter (5-year life, $620 residual value) Accumulated depreciation on old melter (straight-line) Market value of old melter in active secondary market $15,600 10,600 12,620 7,200 5,900 Assuming that Oriole's fiscal year ends on December 31 and depreciation has been...
Here are the accounts available: Accounts Payable Accounts Receivable Accumulated Depreciation - Buildings Accumulated Depreciation - Equipment Accumulated Depreciation - Leasehold Improvements Accumulated Depreciation - Machinery Accumulated Depreciation - Vehicles Advertising Expense Asset Retirement Obligation Buildings Cash Common Shares Contributed Surplus Contributed Surplus - Donated Capital Cost of Goods Sold Deferred Revenue - Government Grants Depreciation Expense Donation Revenue Equipment Finance Expense Finance Revenue Gain on Disposal of Building Gain on Disposal of Equipment Gain on Disposal of Machinery Gain...
Show Attempt History Current Attempt in Progress A partial statement of financial position of Ivanhoe Ltd. on December 31, 2019, showed the following property, plant, and equipment assets accounted for unde cost model (accumulated depreciation includes depreciation for 2019): Buildings Less: accumulated depreciation Equipment Less: accumulated depreciation 5337,000 137.000 $200.000 $125.000 45.000 80.000 Ivanhoe uses straight-line depreciation for its building (remaining useful life of 20 years, no residual value) and for its equipment remaining useful life of years residual value)....
Presented below is information related to equipment owned by Wildhorse Company at December 31, 2020. Cost $10,620,000 Accumulated depreciation to date 1,180,000 Expected future net cash flows 8,260,000 Fair value 5,664,000 Assume that Wildhorse will continue to use this asset in the future. As of December 31, 2020, the equipment has a remaining useful life of 5 years. Prepare the journal entry (if any) to record the impairment of the asset at December 31, 2020. (If no entry is required,...
Brief Exercise 10-14 elue Corporation owns machinery that cost $24,800 when purchased on July 1, 2014. Depreciation has been recorded at a rate of $2,976 per year, resulting in a balance in accumulated depreciation of $10,416 at December 31, 2017. The machinery is sold on September 1, 2018, for $13,020. Prepare journal entries to (a) update depreciation for 2018 and (b) record the sale. (Credit indent manually. If no entry is required, select "No Entry" for the account titles and...
At December 31, 2022, Blue Corporation reported the following plant assets. Land $4,548,000 Buildings $26,520,000 18,078,300 8,441,700 Less: Accumulated depreciation-buildings Equipment Less: Accumulated depreciation equipment Total plant assets 60,640,000 7,580,000 53,060,000 $66,049,700 During 2023, the following selected cash transactions occurred. Apr. 1 Purchased land for $3,335,200. May 1 Sold equipment that cost $909.600 when purchased on January 1, 2016. The equipment was sold for $257.720. June 1 Sold land for $2.425,600. The land cost $1.516,000. July 1 Purchased equipment for...
On January 1, 2020, Indigo Corporation issued $687,000 of 8% bonds that are due in 10 years. The bonds were issued for $735,820 and pay interest each July 1 and January 1. The company uses the effective interest method. Assume an effective rate of 7%. (a) Prepare Indigo Corporation’s journal entry for the January 1 issuance. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for...
Please help me fix these errors. Thanks. On December 31, 2020, Sheridan Inc. has a machine with a book value of $1,146,800. The original cost and related accumulated depreciation at this date are as follows. Machine Less: Accumulated depreciation Book value $1,586,000 439,200 $1,146,800 Depreciation is computed at $73,200 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...