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 $38,400, paying cash. |
| Mar. 7. | Paid garage $240 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 8 years, with a residual value of $8,100 for the truck. |
| Year 2 | |
| Jan. 9. | Purchased a new truck for $44,100, paying cash. |
| Feb. 28. | Paid garage $410 to tune the engine and make other minor repairs on the used truck. |
| Apr. 30. | Sold the used truck for $25,300. (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 $7,900 and an estimated life of 7 years. |
| Year 3 | |
| Sept. 1. | Purchased a new truck for $94,000, paying cash. |
| Sept. 4. | Sold the truck purchased January 9, Year 2, for $26,800. (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 $16,900 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 | fill in the blank 2 | fill in the blank 3 |
| Cash | fill in the blank 5 | fill in the blank 6 | |
| Mar. 7 | Truck Repair and Maintenance Expense | fill in the blank 8 | fill in the blank 9 |
| Cash | fill in the blank 11 | fill in the blank 12 | |
| Dec. 31 | Depreciation Expense-Delivery Truck | fill in the blank 14 | fill in the blank 15 |
| Accumulated Depreciation-Delivery Truck | fill in the blank 17 | fill in the blank 18 | |
| Year 2, Jan. 9 | Delivery Truck | fill in the blank 20 | fill in the blank 21 |
| Cash | fill in the blank 23 | fill in the blank 24 | |
| Feb. 28 | Truck Repair and Maintenance Expense | fill in the blank 26 | fill in the blank 27 |
| Cash | fill in the blank 29 | fill in the blank 30 | |
| Apr. 30-Deprec. | Depreciation Expense-Delivery Truck | fill in the blank 32 | fill in the blank 33 |
| Accumulated Depreciation-Delivery Truck | fill in the blank 35 | fill in the blank 36 | |
| Apr. 30-Sale | Accumulated Depreciation-Delivery Truck | fill in the blank 38 | fill in the blank 39 |
| Cash | fill in the blank 41 | fill in the blank 42 | |
| Loss on Sale of Delivery Truck | fill in the blank 44 | fill in the blank 45 | |
| Delivery Truck | fill in the blank 47 | fill in the blank 48 | |
| Dec. 31 | Depreciation Expense-Delivery Truck | fill in the blank 50 | fill in the blank 51 |
| Accumulated Depreciation-Delivery Truck | fill in the blank 53 | fill in the blank 54 | |
| Year 3, Sept. 1 | Delivery Truck | fill in the blank 56 | fill in the blank 57 |
| Cash | fill in the blank 59 | fill in the blank 60 | |
| Sept. 4-Deprec. | Depreciation Expense-Delivery Truck | fill in the blank 62 | fill in the blank 63 |
| Accumulated Depreciation-Delivery Truck | fill in the blank 65 | fill in the blank 66 | |
| Sept. 4-Sale | Cash | fill in the blank 68 | fill in the blank 69 |
| Accumulated Depreciation-Delivery Truck | fill in the blank 71 | fill in the blank 72 | |
| Delivery Truck | fill in the blank 74 | fill in the blank 75 | |
| Gain on Sale of Delivery Truck | fill in the blank 77 | fill in the blank 78 | |
| Dec. 31 | Depreciation Expense-Delivery Truck | fill in the blank 80 | fill in the blank 81 |
| Accumulated Depreciation-Delivery Truck | fill in the blank 83 | fill in the blank 84 |
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Auditing A Business Risk Approach
Authors: Karla Johnstone, Audrey Gramling, Larry Rittenberg
8th edition
978-0538476232
