P8-6B On January 1, 2014, Alter Company had Accounts Receivable $154,000; Notes Receivable of $12,000; and Allowance for Doubtful Accounts of $13,200. The note receiv-able is from Hartwig Company. It is a 4-month, 9% note dated December 31, 2013. Alter Company prepares financial statements annually. During the year, the following selected transactions occurred. Jan. 5 Sold $10,000 of merchandise to Flynn Company, terms n/15. 20 Accepted Flynn Companys $10,000, 3-month, 6% note for balance due. Feb. 18 Sold $4,000 of merchandise to Mink Company and accepted Minks $4,000, 6-month, 8% note for the amount due. Apr. 20 Collected Flynn Company note in full. 30 Received payment in full from Hartwig Company on the amount due. May 25 Accepted Creech Inc.s $9,000, 6-month, 4% note in settlement of a past-due balance on account. Aug. 18 Received payment in full from Mink Company on note due.Sept. 1 Sold $5,000 of merchandise to Glazer Company and accepted a $5,000, 6-month, 6% note for the amount due. Instructions Journalize the transactions (Omit Cost of goods sold entries) P9-2B. At December 31, 2013, Tong Corporation reported these plant assets. Land $ 4,000,000Buildings $28,800,000Less: Accumulated depreciationbuildings 11,520,000 17,280,000Equipment 48,000,000 Less: Accumulated depreciationequipment 5,000,000 43,000,000 Total plant assets $64,280,000 During 2014, the following selected cash transactions occurred Apr. 1 Purchased land for $2,600,000. May 1 Sold equipment that cost $750,000 when purchased on January 1, 2009. The equipment was sold for $367,000. June 1 Sold land purchased on June 1, 2002, for $2,000,000. The land cost $800,000. Sept. 1 purchased equipment for $840,000. Dec. 31 Retired equipment that cost $470,000 When purchased on December 31, 2004. No salvage value was received. Instructions (a) Journalize the transactions. ( Hint: You may wish to set up T-accounts, post beginning balances, and then post 2014 transactions.) Tong uses straight-line depreciation for buildings and equipment. The buildings are estimated to have a 40-year life and no salvage value; the equipment is estimated to have a 10-year useful life and no salvage value. Update depreciation on assets disposed of at the time of sale or retirement. (b) Record adjusting entries for depreciation for 2014. (c) Prepare the plant assets section of Tongs balance sheet at December 31, 2014. *P9-7B In recent years Howard Company has purchased three machines. Because of frequent employee turnover in the accounting department, a different accountant was in charge of selecting the depreciation method for each machine, and various methods have been used. Information concerning the machines is summarized in the table below. Salvage Useful Life Machine Acquired Cost Value (in years) Depreciation Method 1 July 1, 2012 $68,000 $5,000 7 Straight-line 2 Apr. 1, 2013 64,000 6,000 4 Declining-balance 3 Sept. 1, 2013 84,000 4,000 8 Units-of-activity For the declining-balance method, Howard Company uses the double-declining rate. For the units-of-activity method, total machine hours are expected to be 40,000. Actual hours of use in the first 3 years were: 2013, 1,200; 2014, 6,400; and 2015, 7,000. Instructions (a) Compute the amount of accumulated depreciation on each machine at December 31, 2015. (b) If machine 2 was purchased on November 1 instead of April 1, what would be the depreciation expense for this machine in 2013? In 2014? (Round to the nearest dollar.) View comments