Question
Need correct journal entry for the following below. Champion Contractors completed the following transactions and events involving the purchase and operation of equipment in its
Need correct journal entry for the following below.
Champion Contractors completed the following transactions and events involving the purchase and operation of equipment in its business. |
2014 | ||
Jan. | 1 | Paid $278,000 cash plus $11,120 in sales tax and $1,700 in transportation (FOB shipping point) for a new loader. The loader is estimated to have a four-year life and a $27,800 salvage value. Loader costs are recorded in the Equipment account. |
Jan. | 3 | Paid $6,000 to enclose the cab and install air conditioning in the loader to enable operations under harsher conditions. This increased the estimated salvage value of the loader by another $1,800. |
Dec. | 31 | Recorded annual straight-line depreciation on the loader. |
2015 | ||
Jan. | 1 | Paid $4,900 to overhaul the loaders engine, which increased the loaders estimated useful life by two years. |
Feb. | 17 | Paid $1,225 to repair the loader after the operator backed it into a tree. |
Dec. | 31 | Recorded annual straight-line depreciation on the loader. |
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