Prior to adjustment at the end of the year, the balance in Trucks is $298,988 and the balance in Accumulated Depreciation—Trucks is $101,200. Details of the subsidiary ledger are as follows: EstimatedAccumulated Depreciation atMiles OperatedTruck No.CostResidual ValueUseful LifeBeginning of YearDuring Year1$85,360$14,940251,500 miles—20,400 miles251,1006,040300,400 miles$14,93032,500 miles376,45013,830202,000 miles61,3308,100 miles486,07822,520235,400 miles24,94022,300 miles A.Determine the depreciation rates per mile and the amount to be credited to the accumulated depreciation section of each of the subsidiary accounts for the miles operated during the current year.B.Journalize the entry on Dec. 31 to record depreciation for the year. Refer to the Chart of Accounts for exact wording of account titles. Chart of Accounts CHART OF ACCOUNTS General Ledger ASSETS110Cash111Petty Cash112Accounts Receivable114Interest Receivable115Notes Receivable116Merchandise Inventory117Supplies119Prepaid Insurance120Land123Trucks124Accumulated Depreciation-Trucks125Equipment126Accumulated Depreciation-Equipment130Mineral Rights131Accumulated Depletion132Goodwill133Patents LIABILITIES210Accounts Payable211Salaries Payable213Sales Tax Payable214Interest Payable215Notes Payable EQUITY310Common Stock311Retained Earnings312Dividends313Income Summary REVENUE410Sales610Interest Revenue620Gain on Sale of Trucks621Gain on Sale of Equipment EXPENSES510Cost of Merchandise Sold520Salaries Expense521Advertising Expense522Depreciation Expense-Trucks523Delivery Expense524Repairs and Maintenance Expense529Selling Expenses531Rent Expense532Depreciation Expense-Equipment533Depletion Expense534Amortization Expense-Patents535Insurance Expense536Supplies Expense539Miscellaneous Expense710Interest Expense720Loss on Sale of Trucks721Loss on Sale of Equipment First Question A. Determine the depreciation rates per mile and the amount to be credited to the accumulated depreciation section of each of the subsidiary accounts for the miles operated during the current year.Truck No.Rate per MileMiles OperatedCredit to Accumulated Depreciation1 20,400 2 32,500 3 8,100 4 22,300 Total Journal B. Journalize the entry on Dec. 31 to record depreciation for the year. Refer to the Chart of Accounts for exact wording of account titles.PAGE 1 JOURNALACCOUNTING EQUATION DATEDESCRIPTIONPOST. REF.DEBITCREDITASSETSLIABILITIESEQUITY1 Adjusting Entries 2 3

Journal entry is a primary entry that records the financial transactions initially.a. b.

Answered: Prior to adjustment at the end of the…

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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Question

Prior to adjustment at the end of the year, the balance in Trucks is $298,988 and the balance in Accumulated Depreciation—Trucks is $101,200. Details of the subsidiary ledger are as follows:

	Estimated	Accumulated Depreciation at	Miles Operated
Truck No.	Cost	Residual Value	Useful Life	Beginning of Year	During Year
1	$85,360	$14,940	251,500 miles	—	20,400 miles
2	51,100	6,040	300,400 miles	$14,930	32,500 miles
3	76,450	13,830	202,000 miles	61,330	8,100 miles
4	86,078	22,520	235,400 miles	24,940	22,300 miles

A.	Determine the depreciation rates per mile and the amount to be credited to the accumulated depreciation section of each of the subsidiary accounts for the miles operated during the current year.
B.	Journalize the entry on Dec. 31 to record depreciation for the year. Refer to the Chart of Accounts for exact wording of account titles.

Chart of Accounts

CHART OF ACCOUNTS

General Ledger

	ASSETS
110	Cash
111	Petty Cash
112	Accounts Receivable
114	Interest Receivable
115	Notes Receivable
116	Merchandise Inventory
117	Supplies
119	Prepaid Insurance
120	Land
123	Trucks
124	Accumulated Depreciation-Trucks
125	Equipment
126	Accumulated Depreciation-Equipment
130	Mineral Rights
131	Accumulated Depletion
132	Goodwill
133	Patents

	LIABILITIES
210	Accounts Payable
211	Salaries Payable
213	Sales Tax Payable
214	Interest Payable
215	Notes Payable

	EQUITY
310	Common Stock
311	Retained Earnings
312	Dividends
313	Income Summary

	REVENUE
410	Sales
610	Interest Revenue
620	Gain on Sale of Trucks
621	Gain on Sale of Equipment

	EXPENSES
510	Cost of Merchandise Sold
520	Salaries Expense
521	Advertising Expense
522	Depreciation Expense-Trucks
523	Delivery Expense
524	Repairs and Maintenance Expense
529	Selling Expenses
531	Rent Expense
532	Depreciation Expense-Equipment
533	Depletion Expense
534	Amortization Expense-Patents
535	Insurance Expense
536	Supplies Expense
539	Miscellaneous Expense
710	Interest Expense
720	Loss on Sale of Trucks
721	Loss on Sale of Equipment

First Question

A. Determine the depreciation rates per mile and the amount to be credited to the accumulated depreciation section of each of the subsidiary accounts for the miles operated during the current year.

Truck No.	Rate per Mile	Miles Operated	Credit to Accumulated Depreciation
1		20,400
2		32,500
3		8,100
4		22,300
Total

Journal

B. Journalize the entry on Dec. 31 to record depreciation for the year. Refer to the Chart of Accounts for exact wording of account titles.

PAGE 1

JOURNAL

ACCOUNTING EQUATION

	DATE	DESCRIPTION	POST. REF.	DEBIT	CREDIT	ASSETS	LIABILITIES	EQUITY
1		Adjusting Entries
2
3

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