Xpress Delivery Service completed the following transactions and events involving the purchase and operation of equipment for its business.
2010 |
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Jan. | 1 | Paid $24,950 cash plus $1,950 in sales tax for a new delivery van that was estimated to have a five-year life and a $3,400 salvage value. Van costs are recorded in the Equipment account. |
Jan. | 3 | Paid $1,550 to install sorting racks in the van for more accurate and quicker delivery of packages. This increases the estimated salvage value of the van by another $200. |
Dec. | 31 | Recorded annual straight-line depreciation on the van. |
2011 |
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Jan. | 1 | Paid $1,970 to overhaul the van’s engine, which increased the van’s estimated useful life by two years. |
May | 10 | Paid $600 to repair the van after the driver backed it into a loading dock. |
Dec. | 31 | Record annual straight-line depreciation on the van. (Round to the nearest dollar.) |
Required
Prepare journal entries to record these transactions and events.
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