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Accounting for Plant Assets Basin Corporation had the following transactions related to its delivery truck: Year 1 Jan. 5 Purchased for $16,400 cash a new
Accounting for Plant Assets
Basin Corporation had the following transactions related to its delivery truck:
Year 1 | |
Jan. 5 | Purchased for $16,400 cash a new truck with an estimated useful life of four years and a salvage value of $2,400. |
Feb. 20 | Installed a new set of side-view mirrors at a cost of $70 cash. |
June 9 | Paid $290 for an engine tune-up, wheel balancing, and a periodic chassis lubrication. |
Aug. 2 | Paid a $275 repair bill for the uninsured portion of damages to the truck caused by Basin's own driver. |
Dec. 31 | Recorded depreciation on the truck for the year. |
Year 2 | |
May 1 | Installed a set of parts bins in the truck at a cost of $900 cash. This expenditure was not expected to increase the salvage value of the truck. |
Dec. 31 | Recorded depreciation on the truck for the year. |
Year 3 | |
Dec. 31 | Recorded depreciation on the truck for the year. |
Basins depreciation policies include (1) using straightline depreciation, (2) recording depreciation to the nearest whole month, and (3) expensing all truck expenditures of $75 or less.
Required Prepare journal entries to record these transactions and adjustments. Round all answers to the nearest dollar.
- Year 1
- Year 2
- Year 3
General Journal | |||
---|---|---|---|
Date | Description | Debit | Credit |
YEAR 1 | |||
Jan. 5 | AnswerAccumulated Depreciation - Delivery TruckCashDelivery TruckDepreciation Expense - Delivery TruckTruck Repairs & Maintenance Expense | Answer | Answer |
AnswerAccumulated Depreciation - Delivery TruckCashDelivery TruckDepreciation Expense - Delivery TruckTruck Repairs & Maintenance Expense | Answer | Answer | |
To record purchase of truck. | |||
Feb. 20 | AnswerAccumulated Depreciation - Delivery TruckCashDelivery TruckDepreciation Expense - Delivery TruckTruck Repairs & Maintenance Expense | Answer | Answer |
AnswerAccumulated Depreciation - Delivery TruckCashDelivery TruckDepreciation Expense - Delivery TruckTruck Repairs & Maintenance Expense | Answer | Answer | |
To record cost of installing side-view mirrors. | |||
June 9 | AnswerAccumulated Depreciation - Delivery TruckCashDelivery TruckDepreciation Expense - Delivery TruckTruck Repairs & Maintenance Expense | Answer | Answer |
AnswerAccumulated Depreciation - Delivery TruckCashDelivery TruckDepreciation Expense - Delivery TruckTruck Repairs & Maintenance Expense | Answer | Answer | |
To record cost of tune-up, wheel balancing and lubrication. | |||
Aug. 2 | AnswerAccumulated Depreciation - Delivery TruckCashDelivery TruckDepreciation Expense - Delivery TruckTruck Repairs & Maintenance Expense | Answer | Answer |
AnswerAccumulated Depreciation - Delivery TruckCashDelivery TruckDepreciation Expense - Delivery TruckTruck Repairs & Maintenance Expense | Answer | Answer | |
To record cost of repairing uninsured damages. | |||
Dec. 31 | AnswerAccumulated Depreciation - Delivery TruckCashDelivery TruckDepreciation Expense - Delivery TruckTruck Repairs & Maintenance Expense | Answer | Answer |
AnswerAccumulated Depreciation - Delivery TruckCashDelivery TruckDepreciation Expense - Delivery TruckTruck Repairs & Maintenance Expense | Answer | Answer | |
To record depreciation on delivery truck. |
General Journal | |||
---|---|---|---|
Date | Description | Debit | Credit |
YEAR 2 | |||
May 1 | AnswerAccumulated Depreciation - Delivery TruckCashDelivery TruckDepreciation Expense - Delivery TruckTruck Repairs & Maintenance Expense | Answer | Answer |
AnswerAccumulated Depreciation - Delivery TruckCashDelivery TruckDepreciation Expense - Delivery TruckTruck Repairs & Maintenance Expense | Answer | Answer | |
To record cost of installing part bins. | |||
Dec. 31 | AnswerAccumulated Depreciation - Delivery TruckCashDelivery TruckDepreciation Expense - Delivery TruckTruck Repairs & Maintenance Expense | Answer | Answer |
AnswerAccumulated Depreciation - Delivery TruckCashDelivery TruckDepreciation Expense - Delivery TruckTruck Repairs & Maintenance Expense | Answer | Answer | |
To record depreciation on delivery truck. |
General Journal | |||
---|---|---|---|
Date | Description | Debit | Credit |
YEAR 3 | |||
Dec. 31 | AnswerAccumulated Depreciation - Delivery TruckCashDelivery TruckDepreciation Expense - Delivery TruckTruck Repairs & Maintenance Expense | Answer | Answer |
AnswerAccumulated Depreciation - Delivery TruckCashDelivery TruckDepreciation Expense - Delivery TruckTruck Repairs & Maintenance Expense | Answer | Answer | |
To record depreciation on delivery truck. |
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