6 Yoshi Company completed the following transactions and events involving its de

Question

6 Yoshi Company completed the following transactions and events involving its delivery trucks. 2016 Jan. Paid $22,015 cash plus $1,785 in sales tax for a new delivery truck estimated to have a five-year life and a Dec. 31 Recorded annual straight-line depreciation on the truck 2017 Dec. 31 Due to new information obtained earlier in the year, the truck's estimated useful life was changed from five to $2,300 salvage value. Delivery truck costs are recorded in the Trucks account 1.81 points four years, and the estimated salvage value was increased to $2,550. Recorded annual straight-line depreciation on the truck. eBook 2018 Dec. 31 Recorded annual straight-line depreciation on the truck Dec. 31 Sold the truck for $5,500 cash. Print Required 1-a. Calculate depreciation for year 2017 References1-b. Calculate book value and gain (loss) for sale of Truck on December, 2018 1-c. Prepare journal entries to record these transactions and events. Complete this question by entering your answers in the tabs below Required 1A Required 1B Required 1C Calculate book value and gain (loss) for sale of Truck on December, 2018 Depreciation expense (for 2016) Depreciation expense (for 2017) Depreciation expense (for 2018) Accumulated depreciation 12131/2018 Book value of truck at 12/31/2018 Total cost Accumulated depreciation Book value 12/31/2018 4,300 5,650 9,950

Explanation / Answer

CALCULATION OF THE DEPRECIATION AS PER STRAIGHT LINE METHOD Purchase Cost of Truck(22,015+ 1785) $                23,800.00 Less: Salvage Value $                      230.00 Net Value for Depreciation $                23,570.00 Usefule life of the Truck 5 years Depreciation per year = Value for Depreciation / 5 years =                      4,714.00 CALCULATION OF THE DEPRECIATION FOR THE YEAR 2017 Purchae Value of truck = $                23,800.00 Less: Depreciation for the year 2016 $                  4,714.00 Opening Balance of the 2017 $                19,086.00 Less: Salvage Value $                  2,550.00 Net Value for Depreciation $                16,536.00 Remaining life of the truck 3 years Depreciation per year = Value for Depreciation / 3 years = $                  5,512.00 Answer = Depreciation for the year 2017 =                      5,512.00 Journal Entries Date Account Title and explanation Debit Credit Dec, 31 2018 Depreciation $                        5,512             To Truck $                          5,512 (To record the Depreciation for the year 2018) Dec, 31 2018 Cash $                        5,500 Loss on sale of the truck $                        2,562       To Truck $                          8,062 (To record the sale of truck) CALCULATION OF THE GAIN OR LOSS ON SALE OF TRUCK Purchase Value of the Truck =                    23,800.00 Less: Depreciation for the year 2016                      4,714.00 Less: Depreciation for the year 2017                      5,512.00 Less: Depreciation for the year 2018                      5,512.00 Accumulated Depreciation                    15,738.00 Book Value at the end of the year 2018                      8,062.00 Sales Value of truck                      5,500.00 Loss on sale                      2,562.00

Related Questions

Navigate

• Browse (All)
• Browse 6
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.