Question
The following transactions and adjusting entries were completed by Legacy Furniture Co. during a three-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 three-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 $15,360, paying cash. |
Nov. 2 | Paid garage $170 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 $3,200 for the truck. |
Year 2 | |
Jan. 6 | Purchased a new truck for $9,000, paying cash. |
Apr. 1 | Sold the used truck purchased on January 4 of Year 1 for $6,270. (Record depreciation to date in Year 2 for the truck.) |
June 11 | Paid garage $350 for miscellaneous repairs to the truck. |
Dec. 31 | Record depreciation for the new truck. It has an estimated residual value of $1,600 and an estimated life of 5 years. |
Year 3 | |
July 1 | Purchased a new truck for $93,000, paying cash. |
Oct. 2 | Sold the truck purchased January 6, Year 2, for $3,480. (Record depreciation to date for Year 3 for the truck.) |
Dec. 31 | Recorded depreciation on the remaining truck purchased on July 1. It has an estimated residual value of $16,700 and an estimated useful life of eight years. |
Required:
Journalize the transactions and the adjusting entries. If an amount box does not require an entry, leave it blank. Do not round intermediate calculations. Round your final answers to the nearest cent.
Year 1 Jan. 4 | Accounts PayableAccumulated Depreciation-Delivery TruckCashDelivery TruckTruck Repair ExpenseDelivery Truck | ||
Accounts PayableAccumulated Depreciation-Delivery TruckCashDelivery TruckTruck Repair ExpenseCash | |||
Nov. 2 | Accumulated Depreciation-Delivery TruckCashDelivery TruckDepreciation ExpenseTruck Repair ExpenseTruck Repair Expense | ||
Accumulated Depreciation-Delivery TruckCashDelivery TruckDepreciation ExpenseTruck Repair ExpenseCash | |||
Dec. 31 | Accumulated Depreciation-Delivery TruckCashDelivery TruckDepreciation Expense-Delivery TruckTruck Repair ExpenseDepreciation Expense-Delivery Truck | ||
Accumulated Depreciation-Delivery TruckCashDelivery TruckDepreciation Expense-Delivery TruckTruck Repair ExpenseAccumulated Depreciation-Delivery Truck | |||
Year 2 Jan. 6 | Accounts PayableAccumulated Depreciation-Delivery TruckCashDelivery TruckDepreciation ExpenseDelivery Truck | ||
Accumulated Depreciation-Delivery TruckCashDelivery TruckDepreciation Expense-Delivery TruckTruck Repair ExpenseCash | |||
Apr. 1-Deprec. | Accumulated Depreciation-Delivery TruckDelivery TruckDepreciation Expense-Delivery TruckGain on Sale of Delivery TruckTruck Repair ExpenseDepreciation Expense-Delivery Truck | ||
Accumulated Depreciation-Delivery TruckCashDelivery TruckDepreciation Expense-Delivery TruckTruck Repair ExpenseAccumulated Depreciation-Delivery Truck | |||
Apr. 1-Sale | Accumulated Depreciation-Delivery TruckDelivery TruckDepreciation Expense-Delivery TruckGain on Sale of Delivery TruckTruck Repair ExpenseAccumulated Depreciation-Delivery Truck | ||
Accounts PayableCashDelivery TruckDepreciation Expense-Delivery TruckTruck Repair ExpenseCash | |||
Accounts PayableDelivery TruckDepreciation Expense-Delivery TruckGain on Sale of Delivery TruckLoss on Sale of Delivery TruckLoss on Sale of Delivery Truck | |||
Accumulated Depreciation-Delivery TruckCashDelivery TruckGain on Sale of Delivery TruckLoss on Sale of Delivery TruckDelivery Truck | |||
June 11 | Accumulated Depreciation-Delivery TruckDelivery TruckDepreciation Expense-Delivery TruckGain on Sale of Delivery TruckTruck Repair ExpenseTruck Repair Expense | ||
Accounts PayableCashDelivery TruckDepreciation Expense-Delivery TruckTruck Repair ExpenseCash | |||
Dec. 31 | Accumulated Depreciation-Delivery TruckCashDelivery TruckDepreciation Expense-Delivery TruckTruck Repair ExpenseDepreciation Expense-Delivery Truck | ||
Accumulated Depreciation-Delivery TruckCashDelivery TruckDepreciation Expense-Delivery TruckTruck Repair ExpenseAccumulated Depreciation-Delivery Truck | |||
Year 3 July 1 | Accounts PayableAccumulated Depreciation-Delivery TruckCashDelivery TruckTruck Repair ExpenseDelivery Truck | ||
Accounts PayableAccumulated Depreciation-Delivery TruckCashDelivery TruckTruck Repair ExpenseCash | |||
Oct. 2-Deprec. | Accumulated Depreciation-Delivery TruckCashDelivery TruckDepreciation Expense-Delivery TruckTruck Repair ExpenseDepreciation Expense-Delivery Truck | ||
Accumulated Depreciation-Delivery TruckCashDelivery TruckDepreciation Expense-Delivery TruckTruck Repair ExpenseAccumulated Depreciation-Delivery Truck | |||
Oct. 2-Sale | CashDelivery TruckDepreciation Expense-Delivery TruckGain on Sale of Delivery TruckLoss on Sale of Delivery TruckCash | ||
Accounts PayableAccumulated Depreciation-Delivery TruckDelivery TruckDepreciation Expense-Delivery TruckGain on Sale of Delivery TruckAccumulated Depreciation-Delivery Truck | |||
Accounts PayableDelivery TruckDepreciation Expense-Delivery TruckLoss on Sale of Delivery TruckTruck Repair ExpenseLoss on Sale of Delivery Truck | |||
Accounts PayableAccumulated Depreciation-Delivery TruckCashDelivery TruckDepreciation Expense-Delivery TruckDelivery Truck | |||
Dec. 31 | Accumulated Depreciation-Delivery TruckCashDelivery TruckDepreciation Expense-Delivery TruckTruck Repair ExpenseDepreciation Expense-Delivery Truck | ||
Accumulated Depreciation-Delivery TruckCashDelivery TruckDepreciation Expense-Delivery TruckTruck Repair ExpenseAccumulated Depreciation-Delivery Truck |
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