PA9-4 (Algo) Recording Transactions and Adjustments for Tangible and Intangible Assets [LO 9-1, 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 company called Gravure Graphics International. The company uses straight-line depreciation for trucks and other vehicles, double-declining-balance depreciation for buildings, and straight-line amortization for patents. January 2, 2020Paid $88,000 cash to purchase storage shed components.January 3, 2020Paid $4,000 cash to have the storage shed erected. The storage shed has an estimated life of 10 years and a residual value of $7,000.April 1, 2020Paid $31,000 cash to purchase a pickup truck for use in the business. The truck has an estimated useful life of five years and a residual value of $5,000. This vehicle is to be recorded in the Truck account.May 13, 2020Paid $300 cash for minor repairs to the pickup truck's upholstery.July 1, 2020Paid $27,000 cash to purchase patent rights on a new paper bag manufacturing process. The patent is estimated to have a remaining useful life of five years.December 31, 2020Recorded depreciation and amortization on the pickup truck, storage shed, and patent. June 30, 2021Sold the pickup truck for $26,000 cash. (Record the depreciation on the truck prior to recording its disposal.)December 31, 2021Recorded depreciation on the storage shed. Recorded the patent amortization. After recording the patent amortization, determined that the patent was impaired and wrote off its remaining book value (i.e., wrote down the book value to zero).Required:Prepare the journal 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.) ezto.mheducation.com+M Question 9 - Ch 9: Homework Assignment - Connectb Answered: PA9-4 (Algo) Recording Transactions and... | bartlebyCh 9: Homework Assignment iSavedHelpSave & ExitSubmitCheck my work mode : This shows what is correct or incorrect for the work you have completed so far. It does not indicate completion.Return to questionAmortization Expense2,700Accumulated Depreciation-Buildings18,000 XAccumulated Depreciation-Truck3,900Accumulated Amortization2,7001points7June 30, 2021Depreciation Expense2,600Accumulated Depreciation-Truck2,6008June 30, 2021Cash26,000Accumulated Depreciation-Truck6,500Truck31,000Gain on Disposal of PPE1,5009December 31, 202 Depreciation Expense14,400 XAccumulated Depreciation-Buildings14,40010December 31, 202 Amortization Expense5,400Accumulated Amortization5,40011December 31, 202 Accumulated Amortization9,000 XPatents9,000 X12December 31, 202 Impairment Loss18,900Patents18,900McGrawHill( Prev9 of 10Next >88

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Answered: PA9-4 (Algo) Recording Transactions and…

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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PA9-4 (Algo) Recording Transactions and Adjustments for Tangible and Intangible Assets [LO 9-1, 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 company called Gravure Graphics International. The company uses straight-line depreciation for trucks and other vehicles, double-declining-balance depreciation for buildings, and straight-line amortization for patents.

January 2, 2020	Paid $88,000 cash to purchase storage shed components.
January 3, 2020	Paid $4,000 cash to have the storage shed erected. The storage shed has an estimated life of 10 years and a residual value of $7,000.
April 1, 2020	Paid $31,000 cash to purchase a pickup truck for use in the business. The truck has an estimated useful life of five years and a residual value of $5,000. This vehicle is to be recorded in the Truck account.
May 13, 2020	Paid $300 cash for minor repairs to the pickup truck's upholstery.
July 1, 2020	Paid $27,000 cash to purchase patent rights on a new paper bag manufacturing process. The patent is estimated to have a remaining useful life of five years.
December 31, 2020	Recorded depreciation and amortization on the pickup truck, storage shed, and patent.

June 30, 2021	Sold the pickup truck for $26,000 cash. (Record the depreciation on the truck prior to recording its disposal.)
December 31, 2021	Recorded depreciation on the storage shed. Recorded the patent amortization. After recording the patent amortization, determined that the patent was impaired and wrote off its remaining book value (i.e., wrote down the book value to zero).

Required:

Prepare the journal 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.)

ezto.mheducation.com
+
M Question 9 - Ch 9: Homework Assignment - Connect
b Answered: PA9-4 (Algo) Recording Transactions and... | bartleby
Ch 9: Homework Assignment i
Saved
Help
Save & Exit
Submit
Check my work mode : This shows what is correct or incorrect for the work you have completed so far. It does not indicate completion.
Return to question
Amortization Expense
2,700
Accumulated Depreciation-Buildings
18,000 X
Accumulated Depreciation-Truck
3,900
Accumulated Amortization
2,700
1
points
7
June 30, 2021
Depreciation Expense
2,600
Accumulated Depreciation-Truck
2,600
8
June 30, 2021
Cash
26,000
Accumulated Depreciation-Truck
6,500
Truck
31,000
Gain on Disposal of PPE
1,500
9
December 31, 202 Depreciation Expense
14,400 X
Accumulated Depreciation-Buildings
14,400
10
December 31, 202 Amortization Expense
5,400
Accumulated Amortization
5,400
11
December 31, 202 Accumulated Amortization
9,000 X
Patents
9,000 X
12
December 31, 202 Impairment Loss
18,900
Patents
18,900
Mc
Graw
Hill
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