Problem 13-38 [LO 13-1, 13-4, 13-6] hem-Lite, Inc., maintains its accounts on the basis of a fiscal year ending March 31. At March 31, 20X1, the Equipment ccount in the general ledger appeared as shown below. The company uses straight-line depreciation, a 10-year life, nd 10 percent salvage value for all its equipment. It is the company's policy to take a full year's depreciation on all dditions to equipment occurring during the fiscal year, and you may treat this policy as a satisfactory one for the urpose of this problem. The company has recorded depreciation for the fiscal year ended March 31, 20X1. Equipment 4/1/XO Bal. forward | 12/1/18 1/2/X1 2/1/X1 3/1/X1 300,000 12,500 1,126 1,126 1,126 pon further investigation, you find the following contract dated December 1, 20x0, covering the acquisition of quipment: List price 5% sales tax Total Down payment Balance 9% interest, 24 months Contract amount $40,000 2,000 $42,000 12,500 29,500 5,310 $34,810 equired: repare the adjusting entries you would propose as auditor of Chem-Lite, Inc., with respect to the equipment and elated depreciation accounts at March 31, 20X1. (Assume that all amounts given are material.) (If no entry is required or a transaction/event, select "No journal entry required" in the first account field. Round your intermediate omputations to the nearest whole dollar value.) Answer is complete but not entirely correct. General Journal Credit No A Transaction 1 Equipment Deferred interest Interest expense Contract payable Debit 27,811 4,650 930 % 33,391 % B 2 2,503 > Depreciation expense-Equipment Accumulated depreciation-Equipment 2,503