Instructions

The following transactions and adjusting entries were completed by Legacy Furniture Co$.$ during a $3-$year period. All are related to the use of delive equipment. The double$-$declining$-$balance method of depreciation is used.

Year $1$

Jan. $4.$ Purchased a used delivery truck for $$32,000,$ paying cash.

Nov. $2.$ Paid garage $$950$ for miscellaneous repairs to the truck.

Dec. $31.$ Recorded depreciation on the truck for the year. The estimated useful life of the truck is $4$ years, with a residual value of $$2,000$ for the truck.

Year $2$

Jan. $6.$ Purchased a new truck for $$80,000,$ paying cash.

Apr. $1.$ Sold the used truck for $$16,000.($Record depreciation to date in Year $2$ for the truck.$)$

June $11.$ Paid garage $$310$ for miscellaneous repairs to the truck.

Dec. $31.$ Record depreciation for the new truck. It has an estimated residual value of $$7,000$ and an estimated life of $5$ years.