1. In 2020, ABC Ltd. completed the following transactions: On September 5 ABC Ltd wanted to modernize their corporate office furniture and therefore decided to trade in an old delivery truck plus $30,000 for new furniture. The accounting records on September 1 showed the cost of the old truck at $50,000 and related accumulated depreciation of $15,000. The furniture was estimated to have a five-year life and a $10,000 trade-in value. The invoice for the exchange was as follows:

Price of the furniture (equal to its fair value) $ 60,000

Trade-in allowance (20,000 )

Total paid in cash $ 40,000 Dec. 31

Recorded straight-line depreciation on the furniture (to nearest whole month).

Required: Prepare journal entries to record the purchase of furniture and year-end depreciation (7 points). (Round your answer to the nearest dollar).