Question

6 - Record the journal entries for the following (assume straight-line method) 8/1/X1 - Wrote check# 38 for $80000 to purchase equipment. 12/31/X1 - The equipment's estimated life is 5 years and its salvage value $8000. 12/31/X2 - The equpment's estimated life is 5 years and its salvage value $8000. 3/1/X3 - Sold the equipment for $60000. General Journal Date Account/Explanation PR Debit Credit 8/1/20X1 (Ck# 38 - new equipment) 12/31/20X1 (Allocate cost of equipment) 12/31/20X2 Allocate cost of eaninment 7-9

Answer 1

PR Credit Answer: General Ledger Date Account / Explanation 8/1/20x1 Equipment A/c Bank A/C (CK #38 - new equipment) Debit $ 80,000 $ 80,000 $ 6,000 12/31/20X1 Depreciation Expenses A/c Accumulated Depreciation A/c (Allocate Cost of Equipment) $ $ 6,000 $ 14,400 12/31/20X2 Depreciation Expenses A/c Accumulated Depreciation A/c (Allocate Cost of Equipment) $ 14,400 $ 3,600 |3/1/20x3 Depreciation Expenses A/C Accumulated Depreciation A/C (Allocate Cost of Equipment) $ 3,600 $ 60,000 $ 24,000 3/1/20x3 Cash A/C Accumulated Depreciation A/c Equipment Gain on Sale of Equipment (on Sale of Equipment) $ 80,000 4,000 $