Question
Transactions for Fixed Assets, Including Sale The following transactions and adjusting entries were completed by Robinson Furniture Co. during a three-year period. All are related
Transactions for Fixed Assets, Including Sale The following transactions and adjusting entries were completed by Robinson 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. 8. Purchased a used delivery truck for $48,600, paying cash.
Mar. 7. Paid garage $190 for changing the oil, replacing the oil filter, and tuning the engine on the delivery truck.
Dec. 31. Recorded depreciation on the truck for the fiscal year. The estimated useful life of the truck is 9 years, with a residual value of $10,200 for the truck.
Year 2
Jan. 9. Purchased a new truck for $55,860, paying cash.
Feb. 28. Paid garage $340 to tune the engine and make other minor repairs on the used truck.
Apr. 30. Sold the used truck for $33,600. (Record depreciation to date in Year 2 for the truck.)
Dec. 31. Record depreciation for the new truck. It has an estimated trade-in value of $10,100 and an estimated life of 7 years.
Year 3
Sept. 1. Purchased a new truck for $84,000, paying cash.
Sept. 4. Sold the truck purchased January 9, Year 2, for $34,000. (Record depreciation to date in Year 3 for the truck.)
Dec. 31. Recorded depreciation on the remaining truck. It has an estimated residual value of $15,100 and an estimated useful life of 10 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. 8 Delivery Truck 48,600 Cash 48,600
Mar. 7 Truck Repair Expense 190 Cash 190
Dec. 31 Depreciation Expense-Delivery Truck Accumulated Depreciation-Delivery Truck
Year 2
Jan. 9 Delivery Truck 55,860 Cash 55,860
Feb. 28 Truck Repair Expense 340 Cash 340
Apr. 30-Deprec. Apr. 30-Sale Dec. 31
Year 3
Sept. 1 Delivery Truck 84,000 Cash 84,000
Sept. 4-Deprec.
Sept. 4-Sale Dec. 31
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