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The following transactions and adjusting entries were completed by a paper-packaging company called Gravure Graphics International during 2015 and 2016. The company uses straight-line depreciation

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The following transactions and adjusting entries were completed by a paper-packaging company called Gravure Graphics International during 2015 and 2016. The company uses straight-line depreciation for trucks and other vehicles, double-declining-balance depreciation for buildings, and straight-line amortization for patents.

January2, 2015

Paid $99,000 cash to purchase storage shed components.

January3, 2015

Paid $2,000 cash to have the storage shed erected. The storage shed has an estimated life of 10 years and a residual value of $5,000.

April1, 2015

Paid $45,000 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 $3,000.

May13, 2015Paid $900 cash for repairs to the pickup truck.
July1, 2015

Paid $16,000 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.

December31, 2015

Recorded depreciation and amortization on the pickup truck, storage shed, and patent.

June30, 2016

Sold the pickup truck for $38,000 cash. (Record the depreciation on the truck prior to recording its disposal.)

December31, 2016

Recorded depreciation on the storage shed. Determined that the patent was impaired and wrote off its remaining book value (i.e., wrote down the book value to zero).

image text in transcribed The following transactions and adjusting entries were completed by a paper-packaging compan Gravure Graphics International during 2015 and 2016. The company uses straight-line deprecia trucks and other vehicles, double-declining-balance depreciation for buildings, and straight-line amortization for patents. January January April 2 , 2015 , 2015 3 1 , 2015 May , 2015 1 3 July Paid $99,000 cash to purchase storage shed components. Paid $2,000 cash to have the storage shed erected. The storage shed h estimated life of 10 years and a residual value of $5,000. Paid $45,000 cash to purchase a pickup truck for use in the business. T has an estimated useful life of five years and a residual value of $3,000. Paid $900 cash for repairs to the pickup truck. , 2015 1 Decemb , 2015 er 3 1 June , 2016 3 0 Decemb , 2016 er 3 1 Paid $16,000 cash to purchase patent rights on a new paper bag manuf process. The patent is estimated to have a remaining useful life of five y Recorded depreciation and amortization on the pickup truck, storage sh patent. Sold the pickup truck for $38,000 cash. (Record the depreciation on the to recording its disposal.) Recorded depreciation on the storage shed. Determined that the patent impaired and wrote off its remaining book value (i.e., wrote down the bo zero). Record the purchase of storage shed components for $99,000 Date General Journal Debit Credit Jan 2,2015 Record the payment of $2,000 to have the storage shed erected. Date General Journal Debit Credit Jan 3,2015 Record the purchase of a pickup truck for $45,000. Date General Journal Debit Credit Debit Credit April 1,2015 Record the repairs of $900 to the pickup truck. Date General Journal May 13,2015 Record the purchase of a patent for $16,000 on a new paper bag manufacturing process. Date General Journal Debit Credit July 1,2015 Record the depreciation and amortization expense on the pickup truck, storage shed and patent for the year. Date General Journal Debit Credit Dec 31 ,2015 , Record the depreciation for the truck up to the date of sale. Date General Journal Debit Credit June 30 ,2015 Record the sale of the pickup truck for $38,000 cash. Date General Journal Debit June 30 ,2015 Record the depreciation on the storage shed for the year. Credit Date General Journal Debit Credit Dec 31 ,2016 , Record any impairment loss incurred on the patent. Date Dec 31 ,2016 , General Journal Debit Credit

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