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Accounting practice problem 8 Yoshi Company completed the following transactions and events involving its delivery trucks. Year 1 Jan. 1 Paid $20,515 cash plus $1,935
Accounting practice problem 8
Yoshi Company completed the following transactions and events involving its delivery trucks. Year 1
Jan. | 1 | Paid $20,515 cash plus $1,935 in sales tax for a new delivery truck estimated to have a five-year life and a $2,450 salvage value. Delivery truck costs are recorded in the Trucks account. | ||
Dec. | 31 | Recorded annual straight-line depreciation on the truck. |
Year 2
Dec. | 31 | The trucks estimated useful life was changed from five to four years, and the estimated salvage value was increased to $2,700. Recorded annual straight-line depreciation on the truck. |
Year 3
Dec. | 31 | Recorded annual straight-line depreciation on the truck. | ||
Dec. | 31 | Sold the truck for $5,600 cash. |
Required: 1-a. Calculate depreciation for Year 2. 1-b. Calculate book value and gain (loss) for sale of Truck on December 31, Year 3. 1-c. Prepare journal entries to record these transactions and events.
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