The following transactions and adjusting entries were completed by Legacy Furniture Co. during a three-year period. All are related to the use of delivery equipment. The double-declining-balance method of depreciation is used.Year 1 Jan. 4.Purchased a used delivery truck for $28,000, paying cash.Nov. 2.Paid garage $675 for miscellaneous repairs to the truck.Dec. 31.Recorded depreciation on the truck for the year. The estimated useful life of the truck is four years, with a residual value of $5,000 for the truck.Year 2 Jan. 6.Purchased a new truck for $48,000, paying cash.Apr. 1.Sold the used truck for $15,000. (Record depreciation to date in Year 2 for the truck.)June 11.Paid garage $450 for miscellaneous repairs to the truck.Dec. 31.Record depreciation for the new truck. It has an estimated residual value of $9,000 and an estimated life of five years.Year 3 July 1.Purchased a new truck for $54,000, paying cash.Oct. 2.Sold the truck purchased January 6, Year 2, for $16,750. (Record depreciation to date for Year 3 for the truck.)Dec. 31.Recorded depreciation on the remaining truck. It has an estimated residual value of $12,000 and an estimated useful life of eight years. Journalize the transactions and the adjusting entries. Refer to the Chart of Accounts for exact wording of account titles.CHART OF ACCOUNTSLegacy Furniture Co.General Ledger ASSETS110Cash111Petty Cash112Accounts Receivable114Interest Receivable115Notes Receivable116Merchandise Inventory117Supplies119Prepaid Insurance120Land123Delivery Truck124Accumulated Depreciation-Delivery Truck125Equipment126Accumulated Depreciation-Equipment130Mineral Rights131Accumulated Depletion132Goodwill133Patents LIABILITIES210Accounts Payable211Salaries Payable213Sales Tax Payable214Interest Payable215Notes Payable EQUITY310Common Stock311Retained Earnings312Dividends313Income Summary REVENUE410Sales610Interest Revenue620Gain on Sale of Delivery Truck621Gain on Sale of Equipment EXPENSES510Cost of Merchandise Sold520Salaries Expense521Advertising Expense522Depreciation Expense-Delivery Truck523Delivery Expense525Truck Repair Expense529Selling Expenses531Rent Expense532Depreciation Expense-Equipment533Depletion Expense534Amortization Expense-Patents535Insurance Expense536Supplies Expense539Miscellaneous Expense710Interest Expense720Loss on Sale of Delivery Truck721Loss on Sale of Equipment Adjusting Entries111113Journalize the Year 3 transactions and acjusting entries on Page 3.PAGE 3JOURNALACCOUNTING EQUATIONDATEDESCRIPTIONPOST. REF.DEBITCREDITASSETSLIABILITIESEQUITY1Adjusting Entries11 Journalize the transactions and the aojusting entries. Refer to the Chart of Accounts for exact wording of account ttes Scrol down to access pages 2 and 3 of the journal.Journalize the Year 1 transactions and adjusting entries on Page 1.PAGE 1JOURNALACCOUNTING EQUJATIONDATEDESCRIPTIONPOST. REF.DEBITCREDITASSETSLIABILITIESEQUITY1Adjusting EntriesJournalize the Year 2 transactions and adjusting entries on Page 2.PAGE 2JOURNALACCOUNTING EQUATIONDATEDESCRIPTIONPOST. REFDEBITCREDITASSETSLIABILITIESEQUITY1

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Description: The following transactions and adjusting entries were completed by Legacy Furniture Co. during a three-year period. All are related to the use of delivery equipment. The double-declining-balance method of depreciation is used.Year 1 Jan. 4.Purchased

The depreciation is charged on asset as the reduced value for the asset with the passage of time.

The following transactions and adjusting entries were completed by Legacy Furniture Co. during a three-year period. All are related to the use of delivery equipment. The double-declining-balance method of depreciation is used. Year 1 Jan. 4. Purchased a used delivery truck for $28,000, paying cash. Nov. 2. Paid garage $675 for miscellaneous repairs to the truck. Dec. 31. Recorded depreciation on the truck for the year. The estimated useful life of the truck is four years, with a residual value of $5,000 for the truck. Year 2 Jan. 6. Purchased a new truck for $48,000, paying cash. Apr. 1. Sold the used truck for $15,000. (Record depreciation to date in Year 2 for the truck.) June 11. Paid garage $450 for miscellaneous repairs to the truck. Dec. 31. Record depreciation for the new truck. It has an estimated residual value of $9,000 and an estimated life of five years. Year 3 July 1. Purchased a new truck for $54,000, paying cash. Oct. 2. Sold the truck purchased January 6, Year 2, for $16,750. (Record depreciation to date for Year 3 for the truck.) Dec. 31. Recorded depreciation on the remaining truck. It has an estimated residual value of $12,000 and an estimated useful life of eight years. Journalize the transactions and the adjusting entries. Refer to the Chart of Accounts for exact wording of account titles.

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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The following transactions and adjusting entries were completed by Legacy Furniture Co. during a three-year period. All are related to the use of delivery equipment. The double-declining-balance method of depreciation is used.

Year 1
Jan. 4.	Purchased a used delivery truck for $28,000, paying cash.
Nov. 2.	Paid garage $675 for miscellaneous repairs to the truck.
Dec. 31.	Recorded depreciation on the truck for the year. The estimated useful life of the truck is four years, with a residual value of $5,000 for the truck.
Year 2
Jan. 6.	Purchased a new truck for $48,000, paying cash.
Apr. 1.	Sold the used truck for $15,000. (Record depreciation to date in Year 2 for the truck.)
June 11.	Paid garage $450 for miscellaneous repairs to the truck.
Dec. 31.	Record depreciation for the new truck. It has an estimated residual value of $9,000 and an estimated life of five years.
Year 3
July 1.	Purchased a new truck for $54,000, paying cash.
Oct. 2.	Sold the truck purchased January 6, Year 2, for $16,750. (Record depreciation to date for Year 3 for the truck.)
Dec. 31.	Recorded depreciation on the remaining truck. It has an estimated residual value of $12,000 and an estimated useful life of eight years.

Journalize the transactions and the adjusting entries. Refer to the Chart of Accounts for exact wording of account titles.

CHART OF ACCOUNTS

Legacy Furniture Co.

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	Delivery Truck
124	Accumulated Depreciation-Delivery Truck
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 Delivery Truck
621	Gain on Sale of Equipment

	EXPENSES
510	Cost of Merchandise Sold
520	Salaries Expense
521	Advertising Expense
522	Depreciation Expense-Delivery Truck
523	Delivery Expense
525	Truck Repair 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 Delivery Truck
721	Loss on Sale of Equipment

Adjusting Entries
11
11
13
Journalize the Year 3 transactions and acjusting entries on Page 3.
PAGE 3
JOURNAL
ACCOUNTING EQUATION
DATE
DESCRIPTION
POST. REF.
DEBIT
CREDIT
ASSETS
LIABILITIES
EQUITY
1
Adjusting Entries
11

Journalize the transactions and the aojusting entries. Refer to the Chart of Accounts for exact wording of account ttes Scrol down to access pages 2 and 3 of the journal.
Journalize the Year 1 transactions and adjusting entries on Page 1.
PAGE 1
JOURNAL
ACCOUNTING EQUJATION
DATE
DESCRIPTION
POST. REF.
DEBIT
CREDIT
ASSETS
LIABILITIES
EQUITY
1
Adjusting Entries
Journalize the Year 2 transactions and adjusting entries on Page 2.
PAGE 2
JOURNAL
ACCOUNTING EQUATION
DATE
DESCRIPTION
POST. REF
DEBIT
CREDIT
ASSETS
LIABILITIES
EQUITY
1

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