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 $96,000 cash to purchase storage shed components. January 3, 2020 Paid $6,000 cash to have the storage shed erected. The storage shed has an estimated life of 10 years and a residual value of $9,000. April 1, 2020 Paid $42,000 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 $7,000. This vehicle is to be recorded in the Truck account. May 13, 2020 Paid $600 cash for minor repairs to the pickup truck's upholstery. July 1, 2020 Paid $19,000 cash to purchase patent 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 depreci on and amortization on the pickup truck, storage shed, and patent. June 30, 2021 Sold the pickup truck for $36,000 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 (i.e., wrote down the book value to zero). Required: Prepare the journal entries required on each of the above dates. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Do not round intermediate calculations.) Journal entry worksheet Record the purchase of storage shed components for $96,000. Note: Enter debits before credits. Date General Journal Debit Credit January 02, 2020 Record entry Clear entry View general journal Journal entry worksheet Record the purchase of a pickup truck for $42,000. Note: Enter debits before credits. Date General Journal Debit Credit April 01, 2020 Truck 42,000 Cash 42,000 Record entry Clear entry View general journal IIII. Record the repairs of $600 to the pickup truck. Note: Enter debits before credits. Date General Journal Debit Credit May 13, 2020 Truck 600 Cash 600 Record entry Clear entry View general journal Journal entry worksheet 2 3 4 5 6 7 8 12 LLLL Record the purchase of a patent for $19,000 on a new paper bag manufacturing process. Note: Enter debits before credits. Date General Journal Debit Credit July 01, 2020 Patents 19,000 Cash 19,000 Record entry Clear entry View general journal Journal entry worksheet Record the depreciation and amortization expense on the pickup truck, storage shed and patent for the year. Note: Enter debits before credits. Date General Journal Debit Credit December 31, 2020 9,300 9,300 Record entry Clear entry View general journal Journal entry worksheet 1 2 3 4 5 6 7 8 12 > Record the depreciation for the truck up to the date of sale. Note: Enter debits before credits. Date General Journal Debit Credit June 30, 2021 Record entry Clear entry View general journal Journal entry worksheet Record the reversal of the accumulated amortization of patents. Note: Enter debits before credits. Date General Journal Debit Credit December 31, 2021 Record entry Clear entry View general journal Journal entry worksheet
