he following transactions and adjusting entries were completed by Legacy Furniture Co. during a three-year period. All are related to the use of delivery equipment. The double-declining-balance method of depreciation is used.

Year 1
Jan. 4	Purchased a used delivery truck for $27,680, paying cash.
Nov. 2	Paid garage $725 for miscellaneous repairs to the truck.
Dec. 31	Recorded depreciation on the truck for the year. The estimated useful life of the truck is four years, with a residual value of $4,900 for the truck.
Year 2
Jan. 6	Purchased a new truck for $49,850, paying cash.
Apr. 1	Sold the used truck purchased on Jan. 4 of Year 1 for $15,050. (Record depreciation to date in Year 2 for the truck.)
June 11	Paid garage $450 for miscellaneous repairs to the truck.
Dec. 31	Recorded depreciation for the new truck. It has an estimated residual value of $9,185 and an estimated life of five years.
Year 3
July 1	Purchased a new truck for $53,640, paying cash.
Oct. 2	Sold the truck purchased January 6, Year 2, for $17,607. (Record depreciation to date for Year 3 for the truck.)
Dec. 31	Recorded depreciation on the remaining truck purchased on July 1. It has an estimated residual value of $12,345 and an estimated useful life of eight years.

Journalize the transactions and the adjusting entries. Refer to the Chart of Accounts for exact wording of account titles.

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Journalize the transactions and the adjusting entries. Refer to the Chart of Accounts for exact wording of account titles. Scroll down to access pages 2 and 3 of the journal.

Journalize the Year 1 transactions and adjusting entries on Page 1.

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Score: 0/76

	DATE	DESCRIPTION	POST. REF.	DEBIT	CREDIT	ASSETS	LIABILITIES	EQUITY
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0 / 15

Journalize the Year 2 transactions and adjusting entries on Page 2.

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	DATE	DESCRIPTION	POST. REF.	DEBIT	CREDIT	ASSETS	LIABILITIES	EQUITY
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Points:

0 / 29

Journalize the Year 3 transactions and adjusting entries on Page 3.

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PAGE 3

JOURNAL

ACCOUNTING EQUATION

Score: 42/125

	DATE	DESCRIPTION	POST. REF.	DEBIT	CREDIT	ASSETS	LIABILITIES	EQUITY
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Points:

8.06 / 24

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Check My Work

Expenditures that improve the asset are recorded as increases to the fixed asset. Expenditures that are ordinary maintenance and repairs are expensed.

Pay attention to the dates fixed assets were purchased and/or sold.

Compare the book value amount to the sale price. If the book value is less than the sale price, the asset was sold for a gain. If the book value is more than the sale price, the asset was sold for a loss. If you no longer have the fixed asset what accounts would have to be eliminated?

In the first year, the balance in the accumulated depreciation account is zero. Remember not to reduce book value below residual value.