Number 3

double-declining-balance method prepare the journal entries to record: 1) the purchase of the machine, 2) the adjusting entries to record depreciation at end of its first and second years in service, and give the machines book value and accumulated depreciation at the end of its second year in service. 2. (5 points) on 2 January 2015, Berry-Love Company paid $150,000, plus a 7% commission and $5,000 in closing costs for a property. The property included land appraised at $87,500, land improvements appraised at $35,000, and a building appraised at $52,500. Prepare the journal entry to record this transaction and the journal entry to record the first years depreciation on the land improvements and building (assuming 10-year useful life and $0 salvage value for both). Berry-Love Company follows the calendar year. 3. (5 points) Marks Construction Company purchased equipment costing $45,000 on January 1, Year 1. The equipment is estimated to have a salvage value of $5,000 and an estimated useful life of 8 years. Straight-line depreciation and the calendar year are used. If the equipment is sold on July 1, Year s for $20,000, prepare the journal entry to record the sale. 4. (5 points) Carolina Furniture world is required by law to collect and remit sales taxes to the state. If Furniture World has $78,000 of cash sales that are subject to a 6% sales tax and a gross margin percentage of 40%, what are the journal entries to record the sales? 5. (10 points) on January 1, 2015 American Omni Company issues bonds dated January 1, 2015 with a par value of $300,000. The bonds mature in 5 years. The contract rate is 9% and the market rate is 8% and interest is paid semiannually on June 30 and December 31. Required: 1) Price the bonds. 2) Prepare journal entry for issuance of the bonds. 3) Prepare the journal entry for the June 30, 2015 interest payment using the straight line method. 4) Prepare the journal entry for the June 30, 2015