Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Journal Entries and adjusting journal entries for the information given for the rest of the given year (2019) February 10 depreciation straight-line method over 7
Journal Entries and adjusting journal entries for the information given for the rest of the given year (2019)
February 10 depreciation straight-line method over 7 years.
For march 1 deprecate using the straight-line method over 25 years.
February 10 To begin development of Pillex. Pops purchases $550,000 of equipment. Of this amount, $100,000 can be used on future research projects and the remainder will only be used to develop Pillex This equipment has a salvage value of $10,000. All equipment is put into use immediately and depreciation for the year is recorded at year-end (12/31). February 20 Orgin, Inc. is a supplier of a key ingredient in Pillex. Given their unique business relationship, Pops decides to purchase 9,000 shares of Orgin. Inc. at $35 / share On the same date, Pops signs a forward contract with Orgin, Inc. to buy 5,000 lbs. of the key ingredient for $100.25/16. It will be delivered to Pops on June 25, 2019. Pops will pay the full price on delivery. March 1 Pops starts a construction project to build a production facility. On this date they pay $450,000 for architectural renderings and make the first payment to Hegar Construction in the amount of $1,200,000. Additionally, on this day, they take out a $4,000,000 construction loan (6% annual rate over 10 years, with annual payments starting on 12/31/19) from First Federal Bank. The entire loan proceeds are deposited into Popsis checking account. The construction is expected to take 7 months. Don't forget to record the receipt of ALL loan proceeds on this dayStep by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started