Answered: A piece of equipment costing $3,000 was…

A piece of equipment costing $3,000 was stolen. The insurance company reimbursed the company $1,000. The accumulated depreciation on the equipment amounted to $1,000 Journal Entry

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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A personal computer that originally cost $5,000 has no estimated salvage value and was depreciated at the rate of 20% a year. At the end of the third year, the computer was sold for $1,500 cash. The transaction would result in a a. loss of $1,500. Ob. gain of $250. Oc. loss of $250. Od. gain of $1,500.
Bill’s Wrecker Service has just completed a minor repair on a tow truck. The repair cost was $990, and the book value prior to the repair was $5,330. In addition, the company spent $6,500 to replace the roof on a building. The new roof extended the life of the building by five years. Prior to the roof replacement, the general ledger reflected the Building account at $90,100 and related Accumulated Depreciation account at $37,400.After the work was completed, what book value should appear on the balance sheet for the tow truck and the building?
Blossom Inc. recently replaced a piece of automatic equipment at a net price of $3,500, f.o.b. factory. The replacement was necessary because one of Blossom’s employees had accidentally backed his truck into Blossom’s original equipment and made it inoperable. Because of the accident, the equipment had no resale value to anyone and had to be scrapped. Blossom’s insurance policy provided for a replacement of its equipment and paid the price of the new equipment directly to the new equipment manufacturer, minus the deductible amount paid to the manufacturer by Blossom. The $3,500 that Blossom paid was the amount of the deductible that it has to pay on any single claim on its insurance policy. The new equipment represents the same value in use to Blossom. The used equipment had originally cost $64,000. It had a book value of $45,000 at the time of the accident and a second-hand market value of $50,000 before the accident, based on recent transactions involving similar equipment. Freight…
Belvidere Furniture purchased land, paying $95,000 cash and signing a $280,000 note payable. In addition, Belvidere paid delinquent property tax of $5,000, title insurance costing $1,500, and $8,000 to level the land and remove an unwanted building. The company then constructed an office building at a cost of $400,000. It also paid $51,000 for a fence around the property, $13,000 for a sign near the entrance, and $3,000 for special lighting of the grounds. Read the requirements. Requirement 1. Determine the cost of the land, land improvements, and building. The cost of the land is $ 389,500 The total cost of the land improvements is The cost of the building is $ 67,000
Diaz Company owns machine that cost $126,300 and has accumulated depreciation of $93,000. Prepare the entry to record the disposal of the machine on January 1 in each separate situation. 1. The machine needed extensive repairs and was not worth repairing. Diaz disposed of the machine, receiving nothing in return. 2. Diaz sold the machine for $16,600 cash. 3. Diaz sold the machine for $33,300 cash. 4. Diaz sold the machine for $40,400 cash. View transaction list Journal entry worksheet 1 2 Record the disposal of the machine receiving nothing in return. Date January 01 3 4 Note: Enter debits before credits. Record entry General Journal Clear entry Debit Credit View general Journal >
On-Time Delivery Company acquired an adjacent lot to construct a new warehouse, paying $32,000 in cash and giving a short-term note for $302,000. Legal fees paid were $1,580, delinquent taxes assumed were $15,200, and fees paid to remove an old building from the land were $19,100. Materials salvaged from the demolition of the building were sold for $5,000. A contractor was paid $1,015,400 to construct a new warehouse. Determine the cost of the land to be reported on the balance sheet.fill in the blank 1 of 1$
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Blossom Inc. recently replaced a piece of automatic equipment at a net price of $3,500, f.o.b. factory. The replacement was necessary because one of Blossom’s employees had accidentally backed his truck into Blossom’s original equipment and made it inoperable. Because of the accident, the equipment had no resale value to anyone and had to be scrapped. Blossom’s insurance policy provided for a replacement of its equipment and paid the price of the new equipment directly to the new equipment manufacturer, minus the deductible amount paid to the manufacturer by Blossom. The $3,500 that Blossom paid was the amount of the deductible that it has to pay on any single claim on its insurance policy. The new equipment represents the same value in use to Blossom. The used equipment had originally cost $64,000. It had a book value of $45,000 at the time of the accident and a second-hand market value of $50,000 before the accident, based on recent transactions involving similar equipment. Freight…
A company purchased a computer that cost $10,000, It had an estimated useful life of 5 years and no residual value. The computer was depreciated by the straight-line method and it was sold at the end of the second year of use for $5,000 cash. The company should record:
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Calvin Corporation’s office was burglarized. The thieves stole 10 laptop computers andother electronic equipment. The lost assets had an original cost of $35,000 andaccumulated tax depreciation of $19,400. Calvin received an insurance reimbursementof $10,000 related to the theft loss.Required:Determine the amount and character of gain or loss recognized as a result of this theft.Note: Enter a loss with a minus sign.
Several months ago, Ayers Industries Inc. experienced a hazardous materials spill at one of its plants. As a result, the Environmental Protection Agency (EPA) fined the company $248,000. The company is contesting the fine. In addition, an employee is seeking $213,000 in damages related to the spill. Lastly, a homeowner has sued the company for $324,000. The homeowner lives 35 miles from the plant but believes that the incident has reduced the home’s resale value by $324,000. Ayers’ legal counsel believes that it is probable that the EPA fine will stand. In addition, counsel indicates that an out-of-court settlement of $130,000 has recently been reached with the employee. The final papers will be signed next week. Counsel believes that the homeowner’s case is much weaker and will be decided in favor of Ayers. Other litigation related to the spill is possible, but the damage amounts are uncertain. Required: a. Journalize the contingent liabilities associated with the…