Cullumber Company had the following assets on January 1, 2022. Item Cost Purchase Date Useful Life(in years) Salvage Value Machinery $72,000 Jan. 1, 2012 10 $ 0 Forklift 31,000 Jan. 1, 2019 5 0 Truck 37,400 Jan. 1, 2017 8 3,000 During 2022, each of the assets was removed from service. The machinery was retired on January 1. The forklift was sold on June 30 for $12,100. The truck was discarded on December 31.Journalize all entries required on the above dates, including entries to update depreciation, where applicable, on disposed assets. The company uses straight-line depreciation. All depreciation was up to date as of December 31, 2021. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit choose a transaction date Jan. 1June 30Dec. 31 enter an account title enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount choose a transaction date Jan. 1June 30Dec. 31 enter an account title to record depreciation expense on forklift enter a debit amount enter a credit amount enter an account title to record depreciation expense on forklift enter a debit amount enter a credit amount (To record depreciation expense on forklift) choose a transaction date Jan. 1June 30Dec. 31 enter an account title to record sale of forklift on June 30 enter a debit amount enter a credit amount enter an account title to record sale of forklift on June 30 enter a debit amount enter a credit amount enter an account title to record sale of forklift on June 30 enter a debit amount enter a credit amount enter an account title to record sale of forklift on June 30 enter a debit amount enter a credit amount (To record sale of forklift) choose a transaction date Jan. 1June 30Dec. 31 enter an account title to record depreciation expense on truck enter a debit amount enter a credit amount enter an account title to record depreciation expense on truck enter a debit amount enter a credit amount (To record depreciation expense on truck) choose a transaction date Jan. 1June 30Dec. 31 enter an account title to record sale of truck on December 31 enter a debit amount enter a credit amount enter an account title to record sale of truck on December 31 enter a debit amount enter a credit amount enter an account title to record sale of truck on December 31 enter a debit amount enter a credit amount (To record sale of truck)
Cullumber Company had the following assets on January 1, 2022. Item Cost Purchase Date Useful Life(in years) Salvage Value Machinery $72,000 Jan. 1, 2012 10 $ 0 Forklift 31,000 Jan. 1, 2019 5 0 Truck 37,400 Jan. 1, 2017 8 3,000 During 2022, each of the assets was removed from service. The machinery was retired on January 1. The forklift was sold on June 30 for $12,100. The truck was discarded on December 31.Journalize all entries required on the above dates, including entries to update depreciation, where applicable, on disposed assets. The company uses straight-line depreciation. All depreciation was up to date as of December 31, 2021. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit choose a transaction date Jan. 1June 30Dec. 31 enter an account title enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount choose a transaction date Jan. 1June 30Dec. 31 enter an account title to record depreciation expense on forklift enter a debit amount enter a credit amount enter an account title to record depreciation expense on forklift enter a debit amount enter a credit amount (To record depreciation expense on forklift) choose a transaction date Jan. 1June 30Dec. 31 enter an account title to record sale of forklift on June 30 enter a debit amount enter a credit amount enter an account title to record sale of forklift on June 30 enter a debit amount enter a credit amount enter an account title to record sale of forklift on June 30 enter a debit amount enter a credit amount enter an account title to record sale of forklift on June 30 enter a debit amount enter a credit amount (To record sale of forklift) choose a transaction date Jan. 1June 30Dec. 31 enter an account title to record depreciation expense on truck enter a debit amount enter a credit amount enter an account title to record depreciation expense on truck enter a debit amount enter a credit amount (To record depreciation expense on truck) choose a transaction date Jan. 1June 30Dec. 31 enter an account title to record sale of truck on December 31 enter a debit amount enter a credit amount enter an account title to record sale of truck on December 31 enter a debit amount enter a credit amount enter an account title to record sale of truck on December 31 enter a debit amount enter a credit amount (To record sale of truck)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Concept explainers
Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
Topic Video
Question
Cullumber Company had the following assets on January 1, 2022.
| Item | Cost | Purchase Date | Useful Life (in years) |
Salvage Value | ||||
|---|---|---|---|---|---|---|---|---|
|
Machinery
|
$72,000 | Jan. 1, 2012 | 10 | $ 0 | ||||
|
Forklift
|
31,000 | Jan. 1, 2019 | 5 | 0 | ||||
|
Truck
|
37,400 | Jan. 1, 2017 | 8 | 3,000 |
During 2022, each of the assets was removed from service. The machinery was retired on January 1. The forklift was sold on June 30 for $12,100. The truck was discarded on December 31.
Journalize all entries required on the above dates, including entries to update
Date
Account Titles and Explanation
Debit
Credit
choose a transaction date Jan. 1June 30Dec. 31
enter an account title
enter a debit amount
enter a credit amount
enter an account title
enter a debit amount
enter a credit amount
choose a transaction date Jan. 1June 30Dec. 31
enter an account title to record depreciation expense on forklift
enter a debit amount
enter a credit amount
enter an account title to record depreciation expense on forklift
enter a debit amount
enter a credit amount
(To record depreciation expense on forklift)
| choose a transaction date Jan. 1June 30Dec. 31 |
enter an account title to record sale of forklift on June 30
enter a debit amount
enter a credit amount
enter an account title to record sale of forklift on June 30
enter a debit amount
enter a credit amount
enter an account title to record sale of forklift on June 30
enter a debit amount
enter a credit amount
enter an account title to record sale of forklift on June 30
enter a debit amount
enter a credit amount
(To record sale of forklift)
choose a transaction date Jan. 1June 30Dec. 31
enter an account title to record depreciation expense on truck
enter a debit amount
enter a credit amount
enter an account title to record depreciation expense on truck
enter a debit amount
enter a credit amount
(To record depreciation expense on truck)
| choose a transaction date Jan. 1June 30Dec. 31 |
enter an account title to record sale of truck on December 31
enter a debit amount
enter a credit amount
enter an account title to record sale of truck on December 31
enter a debit amount
enter a credit amount
enter an account title to record sale of truck on December 31
enter a debit amount
enter a credit amount
(To record sale of truck)
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