Swann Company sold a delivery truck on April 1, Year 5. Swann had acquired the truck on January 1, Year 1, for $44,000. At acquisition, Swann had estimated that the truck would have an estimated life of 5 years and a residual value of $3,000. Swann uses the straight-line method of depreciation. At December 31, Year 4, the truck had a book value of $11,200. 1b. Prepare the necessary journal entries on April 1, Year 5 to record: 1. Depreciation expense of the delivery truck for Year 5 2. The sale of the truck, assuming it sold for $7,600
Swann Company sold a delivery truck on April 1, Year 5. Swann had acquired the truck on January 1, Year 1, for $44,000. At acquisition, Swann had estimated that the truck would have an estimated life of 5 years and a residual value of $3,000. Swann uses the straight-line method of depreciation. At December 31, Year 4, the truck had a book value of $11,200. 1b. Prepare the necessary journal entries on April 1, Year 5 to record: 1. Depreciation expense of the delivery truck for Year 5 2. The sale of the truck, assuming it sold for $7,600
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Swann Company sold a delivery truck on April 1, Year 5. Swann had acquired the truck on January 1, Year 1, for $44,000. At acquisition, Swann had estimated that the truck would have an estimated life of 5 years and a residual value of $3,000. Swann uses the straight-line method of depreciation . At December 31, Year 4, the truck had a book value of $11,200.
1b. Prepare the necessary journal entries on April 1, Year 5 to record:
| 1. | Depreciation expense of the delivery truck for Year 5 |
| 2. | The sale of the truck, assuming it sold for $7,600 |
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