Question
Prepare a sampling of journal entries for long-term assets. Use the second workbook page of the Excel template. Use the Delivery Vehicles account for all
Prepare a sampling of journal entries for long-term assets.
Use the second workbook page of the Excel template. Use the Delivery Vehicles account for all delivery vehicles/vans. Use Excel formulas in the cells to document your calculations.
| Date | Transaction |
| Year 1 | |
| January 3 | Purchased a new delivery van for $45,000 with a note payable. |
| January 10 | Dan's Dependable Delivery paid $10,000 to patent a specially designed delivery vehicle lift system. The patent is for the maximum years. Record the payment to register the patent. Cash is paid. |
| March 13 | Maintained delivery vehicles. Oil changes and general service work by Bill's Service Garage was completed, $200 on account. |
| April 20 | Sold delivery vehicle for $8,000 cash. The original vehicle was purchased for $42,000 and had accumulated depreciation of $38,000. |
| May 10 | Added a new transmission to a delivery van. The transmission was purchased and installed for $1000 on account, by Bill's Service Garage. It is estimated the transmission will extend the expected life by two years. |
| August 20 | Discarded office furniture with a $250 book value. The furniture was originally purchased for $900. |
| September 5 | New equipment was purchased on account for the office. The equipment cost $3500, and the installation, wiring, and set-up cost $1,000. There was cosmetic damage to the equipment in shipping and cost to repair it was $200. Record the transactions. |
| December 31 | Record the first year's annual depreciation expense on the new delivery van in part one: #2 van. |
| December 31 | Record the annual depreciation expense on the used delivery van from part one. #1 van. |
| December 31 | Record one year's amortization on the patent. |
| Year 2 | |
| July 1 | Sold the used delivery van in part 1 (van #1) for $10,000 cash. Update the depreciation expense on the used delivery van and record the sale. |
| September 1 | Purchased a new delivery vehicle with an original cost of $48,000. A van with an original cost of $37,000 and accumulated depreciation of $30,000 was traded in for the new vehicle. The dealer gave a trade-in allowance of $5,000. Dan's Dependable Delivery paid for the new vehicle with a note payable. Record the exchange. |
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