A. 
B.
Kingbird Corporation operates a retail computer store. To improve delivery services to customers, the company purchases four new trucks on April 1, 2020. The terms of acquisition for each truck are described below. 1. Truck #1 has a list price of $36,750 and is acquired for a cash payment of $34,055. 2. Truck #2 has a list price of $39,200 and is acquired for a down payment of $4,900 cash and a zero-interest-bearing note with a face amount of $34,300. The note is due April 1, 2021. Kingbird would normally have to pay interest at a rate of 9% for such a borrowing, and the dealership has an incremental borrowing rate of 8%. 3. Truck #3 has a list price of $39,200. It is acquired in exchange for a computer system that Kingbird carries in inventory. The computer system cost $29,400 and is normally sold by Kingbird for $37,240. Kingbird uses a perpetual inventory system. 4. Truck #4 has a list price of $34,300. It is acquired in exchange for 1,070 shares of common stock in Kingbird Corporation. The stock has a par value per share of $10 and a market price of $13 per share. Prepare the appropriate journal entries for the above transactions for Kingbird Corporation. (Round present value factors to 5 decimal places, e.g. 0.52587 and final answers to 2 decimal places, e.g. 52.75. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter Ofor the amounts.) No. Account Titles and Explanation Debit Credit 1. Trucks 2. 3. 4. Skysong Engineering Corporation purchased conveyor equipment with a list price of $10,100. Presented below are three independent cases related to the equipment. (a) Skysong paid cash for the equipment 8 days after the purchase. The vendor's credit terms are 2/10, n/30. Assume that equipment purchases are initially recorded gross. (b) Skysong traded in equipment with a book value of $1,800 (initial cost $8,500), and paid $10,200 in cash one month after the purchase. The old equipment could have been sold for $400 at the date of trade. (The exchange has commercial substance.) (c) Skysong gave the vendor a $11,800 zero-interest-bearing note for the equipment on the date of purchase. The note was due in one year and was paid on time. Assume that the effective-interest rate in the market was 10%. Prepare the general journal entries required to record the acquisition and payment in each of the independent cases above. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and final answers to O decimal places, e.g. 5,275. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) No. Account Titles and Explanation Debit Credit (a) (To record the purchase of equipment on account.) (To record the payment on account.) (b) (To record the purchase of equipment on account.) (To record the payment on account.) (To record the purchase of equipment with a note.) (To record the payment of the note.)
