need help on 6 - 10 0.60 points PAS-4 Recording Transactions and Adjustments for
ID: 2536700 • Letter: N
Question
need help on 6 - 10
0.60 points PAS-4 Recording Transactions and Adjustments for Tangible and Intangible Assets LO 91, Lo 9-2 LO 9-3, Lo 9-4, LO 9-5, LO 9-6 The following transactions and adjusting entries were completed by a paper packaging Gravure trucks and for patents other vehicles, double declining-balance depreciation for buildings, and straight line amortization $89,000 cash to purchase storage shed c estimated ife of 10 years and a residual value of $9,000 has an estimated useful life of tive years and a residual value of $7,000 January 3,2015 Pad 6,000 h to have the storage shed erected he storage shed has an Apri 1, 2015 Paid $32,000 cash to purchase a pickup truck for use in the business. The truck 13, 2015 Paid $200 cash for repairs to the pickup truck 1, 2015 Paid $25,000 cash to purchase patent rights on a new paper bag manufacturing May process. The patent is estimated to have a remaining useful life of five years December 31, 2015 Recorded depreciation and amortization on the pickup truck, storage shed, and June 30, 2016 Sold the pickup truck for $27,000 cash (Record the depreciation on the truck prior December 31, 2016 Re patent depreciation on the storage shed. Determined that the patent was mpaired and wrote off its remaining book value (e, wrote down the book value to zero). Prepare the jounal entries required on each of the above dates (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Do not round intermediate calculations.)Explanation / Answer
6
December 31,2015
Depreciation Expense
24000
Amortization expense
5200
Accumulated Depreciation - Building
19000
Accumulated Depreciation - Equipment
5000
Accumulated Depreciation - Patent
5200
7
June 30, 2016
Depreciation Expense
2500
Accumulated Depreciation - Equipment
2500
8
June 30, 2016
Cash
27000
Accumulated Depreciation - Equipment
7500
Equipment
32000
Gain on Disposal
2500
9
December31,2016
Depreciation Expense
15200
Accumulated Depreciation - Building
15200
10
December31,2016
Impairment Loss
20800
Patent
20800
For Building Rate of Depriciation is Double Declining = Useful life of Building 10 years so straight line=1/10*2 i.e 20% per year on Base value so depriciation for 2015 comes at 19000(95000*20%) and for 2016 comes at 15200{(95000-19000)*20%}.
Depriciation on Patent and equipment is Straight line Depriciation.
6
December 31,2015
Depreciation Expense
24000
Amortization expense
5200
Accumulated Depreciation - Building
19000
Accumulated Depreciation - Equipment
5000
Accumulated Depreciation - Patent
5200
7
June 30, 2016
Depreciation Expense
2500
Accumulated Depreciation - Equipment
2500
8
June 30, 2016
Cash
27000
Accumulated Depreciation - Equipment
7500
Equipment
32000
Gain on Disposal
2500
9
December31,2016
Depreciation Expense
15200
Accumulated Depreciation - Building
15200
10
December31,2016
Impairment Loss
20800
Patent
20800
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