At December 31, 2022, Swifty Company reported the following as plant assets.Land $ 4,080,000Buildings $28,360,000 Less: Accumulated depreciation—buildings 12,210,000 16,150,000Equipment 48,670,000 Less: Accumulated depreciation—equipment 5,160,000 43,510,000 Total plant assets $63,740,000During 2023, the following selected cash transactions occurred.April 1 Purchased land for $2,000,000.May 1 Sold equipment that cost $780,000 when purchased on January 1, 2019. The equipment was sold for $468,000.June 1 Sold land purchased on June 1, 2013 for $1,410,000. The land cost $392,000.July 1 Purchased equipment for $2,430,000.Dec. 31 Retired equipment that cost $502,000 when purchased on December 31, 2013.Journalize the above transactions. The company uses straight-line depreciation for buildings and equipment. The buildings are estimated to have a 50-year life and no salvage value. The equipment is estimated to have a 10-year useful life and no salvage value. Update depreciation on assets disposed of at the time of sale or retirementRecord adjusting entries for depreciation for 2023. Prepare the plant assets section of Swifty’s balance sheet at December 31, 2023.

For the first time in the books of accounts, business transactions are recorded in the journal.…

Answered: ecember 31, 2022, Swifty Company…

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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At December 31, 2022, Swifty Company reported the following as plant assets.

Land		$ 4,080,000
Buildings	$28,360,000
Less: Accumulated depreciation—buildings	12,210,000	16,150,000
Equipment	48,670,000
Less: Accumulated depreciation—equipment	5,160,000	43,510,000
Total plant assets		$63,740,000

During 2023, the following selected cash transactions occurred.

April 1		Purchased land for $2,000,000.
May 1		Sold equipment that cost $780,000 when purchased on January 1, 2019. The equipment was sold for $468,000.
June 1		Sold land purchased on June 1, 2013 for $1,410,000. The land cost $392,000.
July 1		Purchased equipment for $2,430,000.
Dec. 31		Retired equipment that cost $502,000 when purchased on December 31, 2013.

Journalize the above transactions. The company uses straight-line depreciation for buildings and equipment. The buildings are estimated to have a 50-year life and no salvage value. The equipment is estimated to have a 10-year useful life and no salvage value. Update depreciation on assets disposed of at the time of sale or retirement

Record adjusting entries for depreciation for 2023.

Prepare the plant assets section of Swifty’s balance sheet at December 31, 2023.

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

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