Question

I am not sure what I did wrong here....

Required information [The following information applies to the questions displayed below. Hulme Company operates a small manufacturing facility as a supplement to its regular service activities. At the beginning of 2020, an asset account for the company showed the following balances: Manufacturing equipment Accumulated depreciation through 2019 $ 120,000 57,600 During 2020, the following expenditures were incurred for the equipment: $ 13,000 Major overhaul of the equipment on January 2, 2020, that improved efficiency Routine maintenance and repairs on the equipment 1,000 The equipment is being depreciated on a straight-line basis over an estimated life of 15 years with a $12,000 estimated residual value. The annual accounting period ends on December 31. 3. Prepare the journal entries to record the two expenditures during 2020. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Answer 1

Journal

No.	Transaction	Account Title and Explanation	Debit	Credit
A	1	Equipment	13,000
		Cash		13,000
		(To record major overhauling expense)
B	2	Repair and maintenance expense	1,000
		Cash		1,000
		(To record repair expense)