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 $91,000 cash to purchase storage shed components. January 3, 2020 Paid $2,000 cash to have the storage shed erected. The storage shed has an estimated life of 10 years and residual value of $5,000. April 1, 2020 Paid $34,000 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 $3,000. This vehicle is to be recorded in the Truck account. May 13, 2020 Paid $600 cash for minor repairs to the pickup truck's upholstery. July 1, 2020 Paid $24,000 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 $29,000 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.)
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 $91,000 cash to purchase storage shed components. January 3, 2020 Paid $2,000 cash to have the storage shed erected. The storage shed has an estimated life of 10 years and residual value of $5,000. April 1, 2020 Paid $34,000 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 $3,000. This vehicle is to be recorded in the Truck account. May 13, 2020 Paid $600 cash for minor repairs to the pickup truck's upholstery. July 1, 2020 Paid $24,000 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 $29,000 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.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Transcribed Image Text:Journal entry worksheet
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Record the purchase of storage shed components for $91,000.
Note: Enter debits before credits.
Date
General Journal
Debit
Credit
January 02, 2020
Record entry
Clear entry
View general journal
LO
Transcribed Image Text: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 $91,000 cash to purchase storage shed components.
January 3, 2020 Paid $2,000 cash to have the storage shed erected. The storage shed has an estimated life of 10 years
and a residual value of $5,000.
April 1, 2020 Paid $34,000 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 $3,000. This vehicle is to be recorded in the Truck
account.
May 13, 2020 Paid $600 cash for minor repairs to the pickup truck's upholstery.
July 1, 2020 Paid $24,000 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 $29,000 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.)
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