Question

Purchased office​ equipment,

$ 115 comma 000$115,000.

Paid

$ 73 comma 000$73,000

cash and financed the remainder with a note payable.

Apr. 1

Acquired land and communication equipment in a​ lump-sum purchase. Total cost was

$ 410 comma 000$410,000

paid in cash. An independent appraisal valued the land at

$ 322 comma 875$322,875

and the communication equipment at

$ 107 comma 625$107,625.

Sep. 1

Sold a building that cost

$ 555 comma 000$555,000

​(accumulated depreciation of

$ 255 comma 000$255,000

through December 31 of the preceding​ year).

GrettaGretta

ChungChung

Associates received

$ 340 comma 000$340,000

cash from the sale of the building. Depreciation is computed on a​ straight-line basis. The building has a​ 40-year useful life and a residual value of

$ 75 comma 000$75,000.

Dec. 31

Recorded depreciation as​ follows:

Communication equipment is depreciated by the​ straight-line method over a​ five-year life with zero residual value.

Office equipment is depreciated using the​ double-declining-balance method over five years with a

$ 4 comma 000$4,000

residual value.

ChungChung Associates surveys American eating habits. The​ company's accounts include​ Land, Buildings, Office​ Equipment, and Communication​ Equipment, with a separate Accumulated Depreciation account for each depreciable asset. During 20182018​, GrettaGretta ChungChung Associates completed the following​ transactions:

Answer 1

Date	General Journal	Debit	Credit
1-Jan	Office Equipment	115000
	Cash		73000
	Note Payable 115000-73000		42000
	To record purchase of office equipment with cash and note payable.
1-Apr	Land 410000/(322,875+107,625)*322,875	307500
	Communication Equipment 410000/(322,875+107,625)*107,625	102500
	Cash		410,000
	To record purchase of land and communication equipment with cash.
1-Sep	Depreciation Expense—Building (555,000-75,000)/40*8/12	8000
	Accumulated Depreciation—Building		8000
	To record depreciation on building.
	Cash	340,000
	Accumulated Depreciation—Building 255,000+8000	263000
	Building		555,000
	Gain on disposal		48,000
	To record sale of building
31-Dec	Depreciation Expense—Communication Equipment (102500/5)*9/12	15375
	Accumulated Depreciation—Communication Equipment		15375
	To record depreciation on communication equipment.