PA9-4 (Algo) Recording Transactions and Adjustments for Tangible and Intangible Assets [LO 9-1, LO 9- 2, LO 9-3, LO 9-4, LO 9-5, LO 9-6] The following transactions and adjusting entries were completed by a paper-packaging company called Gravure Graphics International. The company uses straight-line depreciation for trucks and other vehicles, double-declining-balance depreciation for buildings, and straight-line amortization for patents January 2, 2020 Paid $85,000 cash to purchase storage shed components. January 3, 2020 paid ce cash to have the storage shed rected. The storage shed has an estimated life of 10 years and a residual value of 58,000 April 1, 2020 paid $41,0 cash to purchase a pickup truck for use in the business. The truck has an estimated useful life of five years and a residual value of $6.000. This vehicle is to be recorded in the Truck account May 13, 2020 Paid 3600 cash for winor repairs to the pickup truck's upholstery. July 1, 2020 Paid 530,000 cash to purchase patient rights on a new paper bag manufacturing process. The patent is estimated to have a remaining useful life of five years December 31, 2020 Recorded depreciation and a tortization on the pickup truck, storage shed, and patent June 30, 2021 sold the pickup truck for $15,000 cash. (Record the depreciation on the truck prior to recording its disposal.) December 31, 2021 Recorded depreciation on the storage shed. Recorded the patent amortization. After recording the patent amortization, determined that the patent was impaired and wrote off its remaining book value (1.o., wrote down the book value to zero) Required: Answer is complete but not entirely correct. No Date General Journal Credit Debit 90,000 1 January 02, 2020 Buildings Cash 90.000 2 5.000 January 02, 2020 Buildings Cash 5.000 3 April 01, 2020 Truck 41,000 Cash 41.000 4 May 13, 2020 Repairs and Maintenance Expense Cash 800 800 5 July 01, 2020 Patents Cash Olo 30.000 > 30,000 23.050 x 2 500 December 31, 20 Depreciation Expertse Amortization Expense Accumulated Depreciation-Buildings Accumulated Depreciation-Truck Accumulated Amortization OOOO 10,000 X 4,050 x 2.500 X 7 June 30, 2021 Depreciation Expense Accumulated Depreciabon-Buldings 2.7003 2.700 X 8 June 30, 2021 Cash Accumulated Depreciation Buildings Truck Gain on Dispose of PPE 28.000 0.750 X 33.000 1.750 o December 31, 202 Depreciation Expense Accumulated Depreciation Buildings 15.2003 15.200 X 10 December 31, 202. Antortization Experise Accumulated Amortization 5.000 3 5.000 11 December 31, 200 Acourulated Amortization $ 7,500 3 Patents 7.500 5 BE 2 January 03.2020 Buldings Cash 5,000 5.000 3 Apni 01.2020 41,000 Truck Cash 41,000 4 May 13, 2020 Repairs and Maintenance Expense Cash 800 >> 800 5 July 01.2020 0 Patents Cash 30,000 30 000 @ December 31, 202 Depreciation Expense 23,050 2.500 X Amortization Expense Accumulated Depreciation-Bulidings Accumulated Depreciation-Truck Accumulated Amortization Oooo 10,000 X 4.050 X 2500 x 7 June 30, 2021 Depreciation Expense Accumulated Depreciation-Buildings 2.700 3 2.700 X 8 June 30, 2021 Cash Accumulated Depreciation-Buildings Truck Gain on Disposal of PPE 28.000 6,750 X OOOO 33,000 X 1.750 x 9 December 31, 202 Depreciation Experise Accumulated Depreciation Buildings 15.2003 15.2002 10 December 31, 202 Amortization Expense Accumulated Amortization 5.000 X Oo 5,000 3 11 December 21, 202. Accumulated Amortization Pants > 7,500 7.500 3 12 December 31, 262 limpairment Loss 17.500 Patents 17.000 6
