Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Champion Contractors completed the following transactions and events involving the purchase and operation of equipment in its business. 2014 Jan. 1 Paid $302,000 cash plus

image text in transcribed

image text in transcribed

image text in transcribed

Champion Contractors completed the following transactions and events involving the purchase and operation of equipment in its business. 2014 Jan. 1 Paid $302,000 cash plus $12,080 in sales tax and $1,700 in transportation (FOB shipping point) for a new loader. The loader is estimated to have a four-year life and a $30,200 salvage value. Loader costs are recorded in the Equipment account. Jan. 3 Paid $7,000 to enclose the cab and install air-conditioning in the loader to enable operations under harsher conditions. This increased the estimated salvage value of the loader by another $2.100. Dec. 31 Recorded annual straight-line depreciation on the loader. 2015 Jan. 1 Paid $4,400 to overhaul the loader's engine, which increased the loader's estimated useful life by two years. Feb. 17 Paid $1,100 to repair the loader after the operator backed it into a tree. Dec. 31 Recorded annual straight-line depreciation on the loader Required: Prepare journal entries to record these transactions and events. View transaction list 1 Paid $302,000 cash plus $12,080 in sales tax and $1,700 in transportation (FOB shipping point) for a new loader. The loader is estimated to have a four-year life and a $30,200 salvage value. Loader costs are recorded in the Equipment account. 2 Paid $7,000 to endlose the cab and install air-conditioning in the loader to enable operations under harsher conditions. This increased the estimated salvage value of the loader by another $2,100. 3 Recorded annual straight-line depreciation on the loader. 4 Paid $4,400 to overhaul the loader's engine, which increased the loader's estimated useful life by two years. Note : = journal entry has been entered Record entry Clear entry 2 Paid $7,000 to endlose the cab and install air-conditioning in the loader to enable operations under harsher conditions. This increased the estimated salvage value of the loader by another $2,100. 3 Recorded annual straight-line depreciation on the loader. 4 Paid $4,400 to overhaul the loader's engine, which increased the loader's estimated useful life by two years. 5 Paid $1,100 to repair the loader after the operator backed it into a tree. 6 Recorded annual straight-line depreciation on the loader. Note : = journal entry has been entered Record entry Clear entry

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Agile Auditing Transforming The Internal Audit Process

Authors: Rick A. Wright Jr. CIA

1st Edition

1634540689, 978-1634540681

More Books

Students also viewed these Accounting questions