The 2023 adjusted trial balance for Oscar Corporation (the Company) follows. Debits Credits Cash 100,000 Accounts receivable 50,000 Allowance for doubtful accounts 5,000 Inventory 10,000 Equipment 500,000 Accumulated depreciation 100,000 Land 10,000 Accounts payable 25,000 Note payable bank 500,000 Common stock 50,000 Retained earnings Revenues 5,000,000 Gain on sale of equipment 20,000 Bad debt expense 10,000 Expenses 5,020,000 5,700,000 5,700,000 Additional Information • The Company records depreciation on a 5-year SL basis with no salvage value. All of the Company's equipment was placed in service on 1.1.23. • On December 31, 2023, the Company disposed of a piece of equipment on which it had recorded one year of depreciation. The equipment was sold for its original purchase price, for cash. Required What journal entries would have been prepared (and have been recorded by management) for the Company's 2023 depreciation expense and the sale of the equipment on December 31, 2023.
The 2023 adjusted trial balance for Oscar Corporation (the Company) follows. Debits Credits Cash 100,000 Accounts receivable 50,000 Allowance for doubtful accounts 5,000 Inventory 10,000 Equipment 500,000 Accumulated depreciation 100,000 Land 10,000 Accounts payable 25,000 Note payable bank 500,000 Common stock 50,000 Retained earnings Revenues 5,000,000 Gain on sale of equipment 20,000 Bad debt expense 10,000 Expenses 5,020,000 5,700,000 5,700,000 Additional Information • The Company records depreciation on a 5-year SL basis with no salvage value. All of the Company's equipment was placed in service on 1.1.23. • On December 31, 2023, the Company disposed of a piece of equipment on which it had recorded one year of depreciation. The equipment was sold for its original purchase price, for cash. Required What journal entries would have been prepared (and have been recorded by management) for the Company's 2023 depreciation expense and the sale of the equipment on December 31, 2023.
Chapter9: Accounting For Receivables
Section: Chapter Questions
Problem 9PA: Noren Company uses the balance sheet aging method to account for uncollectible debt on receivables....
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Transcribed Image Text:The 2023 adjusted trial balance for Oscar Corporation (the Company) follows.
Debits
Credits
Cash
100,000
Accounts receivable
50,000
Allowance for doubtful accounts
5,000
Inventory
10,000
Equipment
500,000
Accumulated depreciation
100,000
Land
10,000
Accounts payable
25,000
Note payable bank
500,000
Common stock
50,000
Retained earnings
Revenues
5,000,000
Gain on sale of equipment
20,000
Bad debt expense
10,000
Expenses
5,020,000
5,700,000 5,700,000
Additional Information
• The Company records depreciation on a 5-year SL basis with no salvage value. All of the
Company's equipment was placed in service on 1.1.23.
•
On December 31, 2023, the Company disposed of a piece of equipment on which it had
recorded one year of depreciation. The equipment was sold for its original purchase price,
for cash.
Required
What journal entries would have been prepared (and have been recorded by management) for
the Company's 2023 depreciation expense and the sale of the equipment on December 31, 2023.
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