A truck costing $114000 was destroyed when its engine caught fire. At the date of the fire, the accumulated depreciation on the truck was $55000. An insurance check for $129000 was received based on the replacement cost of the truck. The entry to record the insurance proceeds and the disposition of the truck will include a O credit to the Truck account of $59000. O credit to the Accumulated Depreciation account for $55000. Gain on Disposal of $70000. Gain on Disposal of $15000. eTextbook and Media

A truck costing $114000 was destroyed when its engine caught fire. At the date of the fire, the accumulated depreciation on the truck was $55000. An insurance check for $129000 was received based on the replacement cost of the truck. The entry to record the insurance proceeds and the disposition of the truck will include a O credit to the Truck account of $59000. O credit to the Accumulated Depreciation account for $55000. Gain on Disposal of $70000. Gain on Disposal of $15000. eTextbook and Media

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Willow Creek Company purchased and installed carpet in its new general offices on April 30 for a total cost of $18,000. The carpet is estimated to have a 15-year useful life and no residual value.a. Prepare the journal entry necessary for recording the purchase of the new carpet.b. Record the December 31 adjusting entry for the partial-year depreciation expense for the carpet, assuming that Willow Creek Company uses the straight-line method.
As part of a major renovation at the beginning of the year, Atiase Pharmaceuticals, Inc., sold shelving units (recorded as Equipment) that were 10 years old for $800 cash. The shelves originally cost$6,400 and had been depreciated on a straight-line basis over an estimated useful life of 10 yearswith an estimated residual value of $400. Assuming that depreciation has been recorded to the dateof sale, show the effect of the disposal on the accounting equation. Prepare the journal entry torecord the sale of the shelving units.
On April 10, 2021 Gamma Inc discarded an equipment that had an historic cost equal to 12,000 euro and an accumulated depreciation equal to 10,000 euro. Journalize the disposal of the equipment.
On December 29, Patel Products, Inc., sells a delivery van that cost $20,000. After recording the entry to bring the accumulated depreciation up-to-date, the delivery van had accumulated depreciation of $18,000. Patel received $2,000 cash from the purchaser of the delivery van. On December 29, Patel Products, Incorporated, sells a delivery van that cost $20,000. After recording the entry to bring the accumulated depreciation up-to-date, the delivery van had accumulated depreciation of $18,000. Patel received $2,000 cash from the purchaser of the delivery van. Complete the necessary journal entry to record the sale by selecting the account names from the drop-down menus and entering the dollar amounts in the debit or credit columns.
Funseth Farms Inc. purchased a tractor in 2015 at a cost of $30,000. The tractor was sold for $3,000 in 2018.Depreciation recorded through the disposal date totaled $26,000. Prepare the journal entry to record the sale.Now assume the tractor was sold for $10,000; prepare the journal entry to record the sale.
Marigold Company owns equipment that cost $79,000 when purchased on January 1, 2019. It has been depreciated using the straight-line method based on an estimated salvage value of $7,900 and an estimated useful life of 5 years. Depreciation expense adjustments are recognized annually. Instructions: Prepare Marigold Company's journal entries to record the sale of the equipment in these four independent situations. Update depreciation on assets disposed of at time of sale. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries. If no entry is required, select "No Entry" for the account titles and enter o for the amounts.) (a) (b) (c) (d) (e) (A) SR. Account Titles and Explanation (a) (b) Sold for $45,000 on January 1, 2022. Sold for $45,000 on April 1, 2022. Sold for $17,000 on January 1, 2022. Sold for $17,000 on September 1, 2022 Repeat (a), assuming Marigold uses double-declining balance…
Bill's Wrecker Service has just completed a minor repair on a tow truck. The repair cost was $760, and the book value prior to the repair was $4,500. 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 $94,000 and related Accumulated Depreciation account at $41,500. Required After the work was completed, what book value should appear on the balance sheet for the tow truck and the building? Tow Truck Building Book Value
On December 31, Strike Company has decided to discard one of its batting cages. The initial cost of the equipment was $208,831.00 with an accumulated depreciation of $187,947.90. Depreciation has been taken up to the end of the year. The following will be included in the entry to record the disposal. Select the correct answer. Accumulated Depreciation Dr. $208,831.00 Equipment Cr. $208,831.00 Gain on Disposal of Asset Cr. $20,883.10 Loss on Disposal of Asset Dr. $187,947.90
Bill’s Wrecker Service has just completed a minor repair on a tow truck. The repair cost was $1,550, and the book value prior to the repair was $6,500. In addition, the company spent $12,000 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 $85,000 and related Accumulated Depreciation account at $32,000. Required After the work was completed, what book value should appear on the balance sheet for the tow truck and the building? TOW TRUCK: Building:
Hawthorn Company purchased a piece of equipment for $25,000 and has accumulated depreciation of $20,000 at the end of the current year. The company decides to discard the equipment at the end of the current year. What is the journal entry for the disposal? A. Accumulated Depreciation - Equipment Gain on Disposal 30,000 Truck 25,000 B. Equipment Gain on Disposal 25,000 Accumulated Depreciation - Equipment 5,000 20,000 C. Accumulated Depreciation - Equipment 5,000 20, 000 Loss on Disposal 25,000 D. Accumulated Depreciation - Equipment 20, 000 Loss on Disposal 5, 000 Equipment 25, 000
A truck costing S72,000 has accumulated depreciation of $48,000. The truck is sold for $8,500. The journal entry to record this transaction is to: O A. debit Cash for $8,500, debit Truck for $72,000, credit Accumulated Depreciation - Truck for $48,000 and credit Gain on Disposal for S32,500. O B. debit Cash for $15,500, debit Truck for $72,000, credit Accumulated Depreciation - Truck for $48,000, and credit Gain on Disposal for $8,500. OC. debit Accumulated Depreciation - Truck for $48,000, and credit Truck for $48,000. O D. debit Cash for $8,500, debit Accumulated Depreciation - Truck for $48,000, debit loss on Disposal for $15,500 , and credit Truck for $72,000.
A company used straight-line depreciation for an item of equipment that cost $16,950, had a salvage value of $4, 200 and a six-year useful life. After depreciating the asset for three complete years, the salvage value was reduced to $1,695 but its total useful life remained the same. Determine the amount of depreciation to be charged against the equipment during each of the remaining years of its useful life:$3, 780. $6.485$1,275$4,200.$2,960.