LOS 5.24 Depreciation *** Hawk Ltd starter operations on 1 September 2017. Hawk Ltd's accounts at 31 December 2020 included the following balances. Equipment (at cost) Accumulated depreciation - equipment Vehicles (at cost; purchased 21 November 2019) Accumulated depreciation - vehicles Land (at cost; purchased 25 October 2017) Building (at cost; purchased 25 October 2017) Accumulated depreciation - building $182 000 96 400 93 600 39 312 162 000 371 440 57 228 Details of equipment owned at 31 December 2020 are as follows. Machine 1 Purchase date 7 October 2017 4 February 2018 Cost $86 000 $96 000 Useful life 5 years 6 years Residual value $5000 $6000 2 Additional information Hawk Ltd calculates depreciation to the nearest month and balances the records at month-end. Recorded amounts are rounded to the nearest dollar, and the end of the reporting period is 31 December. Hawk Ltd uses straight-line depreciation for all depreciable assets except vehicles, which are depreciated on the diminishing balance at 40% p.a. The vehicles account balance reflects the total paid for two identical delivery vehicles, each of which cost $46 800. . On acquiring the land and building, Hawk Ltd estimated the building's useful life and residual value at 20 years and $10 000 respectively. Required I Prepare general journal entries to record the following transactions that occurred from 1 January 2021. 2021 Jan. 3 Bought new equipment (Equipment 3) for a cash price of $114 000. Freight charges of $884 and installation costs of $3516 were paid in cash. The useful life and residual value were estimated at 5 years and $8000 respectively. June 22 Bought a second-hand vehicle for $30 400 cash. Repainting costs of $1310 and four new tyres costing $690 were paid for in cash. Aug. 28 Exchanged Equipment 1 for office furniture that had a fair value of $25 000 at the date of exchange. The fair value of Equipment 1 at the date of exchange was $23 000. The office furniture originally cost $72 000 and, to the date of exchange, had been depreciated by $48 200 in the previous owner's books. Hawk Ltd estimated the office furniture's useful life and residual value at 8 years and $1080 respectively. Dec. 31 Recorded depreciation. 2022 April 30 paid for repairs and maintenance on the equipment at a cash cost of $1856. May 25 Sold one of the vehicles bought on 21 November 2019 for $13 200 cash. June 26 Installed a fence around the property at a cash cost of $11 000. The fence has an estimated useful life of 10 years and zero residual value. (Debit the cost to a land improvements asset account.) Dec. 31 Recorded depreciation. 2023 Jan.5 Overhauled Equipment 2 at a cash cost of $24 000, after which Hawk Ltd estimated its remaining useful life at 1 additional year and revised its residual value to $10 000. June 20 Traded in the remaining vehicle bought on 21 November 2019 for a new vehicle. A trade-in allowance of $7400 was received and $44 000 was paid in cash. Stamp duty of $1000 and registration and third-party insurance of $1600 were also paid for in cash. Oct. 4 Scrapped the vehicle bought on 22 June 2021, as it had been so badly damaged in a traffic accident that it was not worthwhile repairing it. Dec. 31 Recorded depreciation