Question

Problem H-4 Hb 302 SS 2020 Part 1 Arbeiten Company exchanged one of their trucks and $10,000 cash for a new truck. The old truck cost them $50,000 and had accumulated depreciation of $18,000. The new truck had a list price of $28.000 Required: Joumalize this exchange. Part 2 For the year 20x1, the Landmark Restaurant had sales of $800,000 and expenses of $700.000 excluding depreciation. The building is being leased and the only depreciable asset is equipment in the amount of $100,000. The equipment has a life of ten years with zero salvage value. Required: Calculate the earnings before tax for 20x1 it: 1. The equipment is depreciated under straight-line depreciation. 2. The equipment is depreciated under double declining balance depreciation Part 3 Empire Hotels recently purchased a parcel of land, a building, and some furnishings for $1,200,000 cash. The land was appraised at $400,000, the building at $1.400.000, and the furnishings at $200,000 Required: Journalire the entry to record this lump sum purchase.

Answer 1

I part - I Exchanged truck with & 10,000 cash cost of truck - $ 50,000 Accumulated deps $18,000 New truck price = $ 28,000 Jle for Exchange process Particulas Debit I credits Accumulated depreciation & 18,000 New Truck price I 28,000 Loss Chom Gechage) | 14,000 To cost of bucke $ 50,000 To Cast. 10,000 (Being Asset exchage for cash and loss from the encharge nobied parts Green Sales - $ 800,000 Capenus = $ 700,000 Geluding dep Eg up mut Costa $ 100,000 чи :) - to Чим

.) Equipment depreciated under slm deprecahon - cost of Asset osawage Vale usage life = $ 100,000 00 lo 7) Depreciaton. = 410,000 Depreciation under double decling method. The depreciation Here is 10%. under double deeling method deprecahon ador Depreciation = $100,000 x 207 tid =4 20,000 Calculation of carings before tar under Sim a particulars the dis Amounts a) Sales Revenue piltais $ 800,000 bih Cepenses 1 . \( 70o,000) - Less! Depreciaton I clopog .. d) Earrings before tames & 90,000

Amont & calculation of EBT under double dimisht particulars a) Sales Revenue 4 800,00 b. Less Expenes 100,000) c) Less Deprecuator |(20,00) d u Carnings before tan $180,000 part 3 Purchand and, bulidy a $1,200,000 & Furnishy out Jle for purchase particulars 1 Debit credit hand, Buildiy sura do 8 1,200,000 | 1,200,000 (Berry laid & Buldy purchard - & lase To Cast ale