Question

ng. Te ost of the old wood structure was not known. These extensive repairs are estimated R$75,000 because parts of the wood structure were ot to increase the useful life of the building. The company believes the R$75,000 is representative of the parts for the wood structure at the date of purchase Instructions Indicate how each of these transactions would be recorded in the accounting records. 6 E10-24 (Analysis of Subsequent Expenditures) The following transactions occurred during 2016. Assume that depre a on of 10 %per year i charged on all machinery and 5% per year on buildings, on a straight- line basis, with no estimated residual value. Depreciation is charged for a full year on all fixed assets acquired during the year, and no depreciation is charged on fixed assets disposed of during the year. Jan. 30 A building that cost $112,000 in 1999 is torn down to make room for a new building. The wrecking Mar. 10 Machinery that was purchased in 2009 for $16,000 is sold for $2,900 cash, f.o.b. purchaser's plant. Freight contractor was paid $5,100 and was permitted to keep all materials salvaged. of $300 is paid on the sale of this machineny. A gear breaks on a machine that cost $9,000 in 2011. The gear is replaced at a cost of $3,000. The replacement does not extend the useful life of the machine. A speci of $5, 2010. The cost of the base was $4,000, and this amount was charged to the Mac ial base installed for a machine in 2010 when the machine was purchased has to be replaced at a cost 500 because of defective workmanship on the original base. The cost of the machinery was $14.200 in Ma y 18 hinery account in 2010. June 23 One of the buildings is repainted at a cost of $6,900. t had not been painted since it was constructed in 2012 Instructions Prepare general journal entries for the transactions. (Round to the nearest dollar)

Answer 1

Date	General Journal	Debit	Credit
30-Jan	Accumulated depriciation-buildings	95200
	(5%*112000=5600;5600*17=95200)
	Loss on disposal of plant assets	21900
	(112000-95200)+5100
	Buildings		112000
	Cash		5100
10-Mar	Cash(2900-300)	2600
	Accumulated depriciation-Machinery	11200
	(70%*16000=11200)
	Loss on disposal of plant assets	2200
	(16000-11200)+300-2900
	Machinery		16000
20-Mar	Repair and maintenance-Machinery	3000
	cash		3000
	(since it is not capitalised hence expense is charged)
	If it was capitalised machinery account will be debited
18-May	Machinery	5500
	Accumulated depreciation-machinery	2400
	(60%*4000=2400)
	Loss on disposal of plant assets	1600
	(4000-2400)
	Machinery		4000
	Cash		5500
23-Jun	Building maintenance and repairs expense	6900
	cash		6900