1. Purchased a parcel of land on March 1, 2013 for $650,000 by paying $425,000 in cash and

signing a short-term note payable with the seller for $225,000. You must repay the $225,000 in

exactly one year on March 1, 2014. You agree to pay the seller 4.5 percent interest (annual

rate) on a quarterly basis (June 1, September 1, December 1, 2013, and March 1, 2014).

[Adjusting Entry Required]

2. Leased additional warehouse space from Leasing Solutions for two years on June 1st. $92,000

cash was paid on this date which covers the full rental fee for the two years.

[Adjusting Entry Required]

3. Purchased a truck for $140,000 cash on the 1st of January. The truck will be depreciated over

an 8 year period. You decide to use the 200% declining-balance depreciation method because it

is determined that the truck will be more productive when it is newer. The truck has an

estimated salvage value of $8,000

[Adjusting Entry Required]

4. At the end of the year, $42,000 cash was paid to the local bank for the long-term note payable

taken out on January 1, 2013. $38,000 of this was applied to the loan principal. The remaining

amount was the accumulated interest due for 2013.