During the current year, Hitchcock Developers disposed of plant assets in the following transactions. Feb. 10 office equipment costing $24,000 was given to a scrap dealer at no charge. At the date of disposal, accualated depreciation on the office equipment amounted to $21,800. Apr. 1 Hitchcock sold land and a building to Claypool Assoeiates for $900,000, receiving $100,000 cash and a 5y year, 9 percent note recoivable for the remaining balance. Hitehcock's records showed the following amounts: Land, $50,000; Building, $550,000; Mecumulated Depreciation: Building (at the date of disposa1), $260,000. Aug. 15 Hitchcock traded in an old truck for a new one. The old truck had cost $26,000, and its accumulated depreciation anounted to $18,000. The 1ist price of the new truck was $39,000, but Hitcheock negotiated a dealed that included a $10,000 trade-in allowance for the old truek and a payment of $28,000 in cash. Hitchcock ineludes trucks in its vehieles account. oct. 1 yitcheock traded in its old computer systen as part of the purchase of a new system. The old system had cost $15,000, and its accumulated depreciation amounted to $11,000. The new eonputer's list price was $8,000. Hitehcock accepted a trade-in allowance of $500 for the old computer system, paying $1,500 down in cash and Insuing a 1-year, 8 percent note payable for the $6,000 balance owed. Required: a. Prepare journal entries to record each of the disposal transactions. Assume that depreciation expense on each asset has been recorded up to the date of disposal. Thus, you need not update the accumulated depreciation figures stated in the problem. b. Do gains and losses on asset disposals affect gross profit? Complete this question by entering your answers in the tabs below. Prepare journal entries to record each of the disposal transactions. Assume that depreciation expense on each asset has been recorded up to the date of disposal. Thus, you need not update the accumulated depreciation figures stated in the problem. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Journal entry worksheet 34 Record scrapped office equipment; received no salvage value. Note: Enter debits before credits. Prepare journal entries to record each of the disposal transactions. Assume that depreciation expense on each asset has been recorder up to the date of disposal. Thus, you need not update the accumulated depreciation figures stated in the problem. (If no entry is required for a transaction/event, select "No journal entry required" in the first account fleld.) Journal entry worksheet Record the sale of Land and building for part cash, and a five-year, 9 percent note for the balance. Note: Enter debits before credits. Journal entry worksheet Record the trade-in of an old truck for a new one. Note: Enter debits before credits. Journal entry worksheet Record the acquisition of a new computer system by trading in old computer, paying part cash, and issuing a 1 -year, 8% note payable. Note: Enter debits before credits. Do gains and losses on asset disposals affect gross profit
