Question
The following transactions and adjusting entries were completed by Gravure Graphics International, a paper-packaging company. The company uses straight-line depreciation for trucks and other vehicles,
The following transactions and adjusting entries were completed by Gravure Graphics International, a paper-packaging company. 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, | 2016 | Paid $94,600 cash to purchase storage shed components. | ||
January | 3, | 2016 | Paid $4,900 cash to have the storage shed erected; storage shed has an estimated life of ten years and a residual value of $12,000. | ||
April | 1, | 2016 | Paid $36,900 cash to purchase a pickup truck for use in the business; truck has an estimated useful life of five years and a residual value of $7,900. | ||
May | 13, | 2016 | Paid $240 cash for repairs to the pickup truck. | ||
July | 1, | 2016 | Paid $19,900 cash to purchase patent rights on a new paper bag manufacturing process; patent is estimated to have a remaining useful life of five years. | ||
December | 31, | 2016 | Recorded depreciation and amortization on the pickup truck, storage shed, and patent. | ||
June | 30, | 2017 | Sold the pickup truck for $32,050 cash. (Record the depreciation on the truck prior to recording its disposal.) | ||
December | 31, | 2017 | 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.) |
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.)
Please type out the answer and show your work/formulas
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