Question
The following transactions and adjusting entries were completed by Legacy Furniture Co. during a 3-year period. All are related to the use of delivery equipment.
The following transactions and adjusting entries were completed by Legacy Furniture Co. during a 3-year period. All are related to the use of delivery equipment. The double-declining-balance method of depreciation is used.
| Year 1 | |
| Jan. 4. | Purchased a used delivery truck for $32,000, paying cash. |
| Nov. 2. | Paid garage $950 for miscellaneous repairs to the truck. |
| Dec. 31. | Recorded depreciation on the truck for the year. The estimated useful life of the truck is 4 years, with a residual value of $2,000 for the truck. |
| Year 2 | |
| Jan. 6. | Purchased a new truck for $80,000, paying cash. |
| Apr. 1. | Sold the used truck for $16,000. (Record depreciation to date in Year 2 for the truck.) |
| June 11. | Paid garage $310 for miscellaneous repairs to the truck. |
| Dec. 31. | Record depreciation for the new truck. It has an estimated residual value of $7,000 and an estimated life of 5 years. |
| Year 3 | |
| July 1. | Purchased a new truck for $85,000, paying cash. |
| Oct. 2. | Sold the truck purchased January 6, Year 2, for $18,250. (Record depreciation to date for Year 3 for the truck.) |
| Dec. 31. | Recorded depreciation on the remaining truck. It has an estimated residual value of $6,000 and an estimated useful life of 8 years. |
| Required: | |
| Journalize the transactions and the adjusting entries. |
Journalize the transactions and the adjusting entries. Scroll down to access pages 2 and 3 of the journal.
General Journal Instructions
Journalize the Year 1 transactions and adjusting entries on Page 1.
PAGE 1
JOURNAL
ACCOUNTING EQUATION
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Journalize the Year 2 transactions and adjusting entries on Page 2.
PAGE 2
JOURNAL
ACCOUNTING EQUATION
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Journalize the Year 3 transactions and adjusting entries on Page 3.
PAGE 3
JOURNAL
ACCOUNTING EQUATION
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Managerial Accounting
Authors: Ray Garrison, Eric Noreen and Peter Brewer
14th edition
978-007811100, 78111005, 978-0078111006
