What is the correct journal entry for the following transaction?A firm sells a car for $40 cash. The cost of the car is $30 and it has accumulated depreciation of $20.The firm is a business consulting firm, and the car is therefore classified as property, plant & equipment. AssetsCash +40PP&E (net) -30AssetsCash +40PP&E (net) -10AssetsCash +40Inventory -30AssetsCash +40PP&E (net) -10LiabilitiesLiabilitiesLiabilitiesLiabilitiesOwner's EquityGain +10Owner's EquityLoss -30Owner's EquityRevenue +40COGS -30Owner's EquityGain +30

Cash is an current asset of the company. PP&E is non- current asset of the company. Net property…

What is the correct journal entry for the following transaction? A firm sells a car for $40 cash. The cost of the car is $30 and it has accumulated depreciation of $20. The firm is a business consulting firm, and the car is therefore classified as property, plant & equipment.

What is the correct journal entry for the following transaction? A firm sells a car for $40 cash. The cost of the car is $30 and it has accumulated depreciation of $20. The firm is a business consulting firm, and the car is therefore classified as property, plant & equipment.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: J. Smoltz is the owner of an antique furniture store. The business has a delivery van worth $40 000…

A: Since the assets are used for many years in the business, the efficiency of the assets will reduce…

Q: Requirement 7. Calculate the following ratios as of January 31, 2025 for Milton Delivery Service:…

A: Return on Assets: Return on assets (ROA), which is often referred to as return on total assets, is a…

Q: Kingbird Corporation owns machinery that cost $28,400 when purchased on July 1, 2022. Depreciation…

A: As you have asked multiple question i can solve only first question for you please repost the other…

Q: You have been hired as Lucky Baskets Corporation's accountant. Aiming to create a better shopping…

A: Section 351 of the Internal Revenue Code (IRC) in the United States pertains to the tax treatment of…

Q: Novak Company exchanged equipment used in its manufacturing operations plus $4,500 in cash for…

A: Journal Entry is the primary step in recording the transactions in the books of accounts.The…

Q: Blythe Corporation and Jacke Corporation, two companies of roughly the same size, are both involved…

A: The ratio analysis helps to analyze the Financial statements of the business. The various elements…

Q: apital & Revenue Expenditure Consider the following list of expenses incurred by a company:…

A: Capitalized cost of asset consists of acquisition cost of asset and other costs are incurred before…

Q: What’s going on here? A) What analogy did Dr. Fraser use to help you remember what types of accounts…

A: Step 1: "net" amount is equivalent to "book" value. Step 2: Step 3: Step 4:

Q: Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in…

A: Under Section 179, limited deduction is $1,080,000. It must be used more of the than 50% time in…

Q: AAA Company signed a contract charging a customer P600,000 to change the windows of a customer's…

A: Transaction price allocated to material = Total contract price x Material price if sold separately /…

Q: Presented below is selected information related to Martin Burke Inc. at year-end. All these accounts…

A: The question is based on the concept of Accounting Theory.

Q: Garcia Co. owns equipment that costs $77,300, with accumulated depreciation of $42,800. Garcia sells…

A: Lets understand the basics. Journal entry is the book of original entry where first transactions are…

Q: [The following information applies to the questions displayed below.] Mellor Towing Company provides…

A: The journal entries are prepared to record the transactions on regular basis. The adjustment entries…

Q: Wage cost for technicians to test equipment Insurance premium paid during first year of operation on…

A: Every business should capitalise it's fixed assets in use. It means all costs that is necessary to…

Q: Indicate how each of the following transactions would affect Pharoah Ltd's statement of income,…

A: The income statement, balance sheet and cash flow statement are the important financial statements…

Q: Your company sells equipment for $85. The equipment was listed at $100 on your company's Balance…

A: Noncash expenses are business expenses that do not require the expenditure of cash. Noncash expenses…

Q: he following transactions took place during 2021 and were not recorded in the book’s of Monpa: 1.…

A: Journal : It is the primary book of accounts where all the business transaction are recorded at…

Q: Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in…

A: Depreciation deductions refer to the amount of depreciation expense that can be deducted from…

Q: Windsor Inc. traded a used vehicle (cost $24,000, accumulated depreciation $20,700) for another used…

A: The phrase "exchange of assets without commercial substance" describes a scenario in which two…

Q: Concord Truck Company is a large trucking company. The company uses the units-of-production (UOP)…

A: Under this method, depreciation is calculated based on units produced in comparison to the total…

Q: The following accounts correspond to the company Hisellav, S.A, which is dedicated to providing…

Q: 31. Which of the following items qualifies as property, plant and equipment? O Amachine bought for…

Q: Required information [The following information applies to the questions displayed below.] Karane…

A: Answer:- Depreciation is an accounting technique which is used to reduce the book value of assets…

Q: Good Call is a delivery business that provides its services in cash and on credit. It has a large…

A: The income statement is one of the important financial statements of the business, which tells about…

Q: Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in…

A: Deductions are defined as those payments made by a taxpayer during a specific period that can be…

Q: Wiater Company operates a small manufacturing facility. On January 1, 2021, an asset account for the…

A: Assets, liabilities, and stockholders' equity are presented in the balance sheet of the company.

Q: Description Office furniture Machinery Used delivery truck Total S Cost §179 Expense MACRS Basis 0 $…

A: Depreciation is an accounting technique which is used to reduce the book value of assets due to its…

Q: You are the acoountant for Mon Inc, a manufacturer of automobiles. This yoar, Mon Inc. used (and…

A: Amount of 525000 related to expense ,it can also be called supplies

Q: Required information [The following information applies to the questions displayed below.) Karane…

A: Businesses are able to deduct costs associated with purchasing physical assets particularly for use…

Q: Required information [The following information applies to the questions displayed below.] Evergreen…

A: Allowable depreciation means the amount of depreciation that is allowed by tax authorities as a…

Q: - Classify the following list of items as: revenue/expense/current asset/non-current asset/current…

A: 1. a machine for manufacturing widgets A machine is a fixed assets. It is classified as Non current…

Q: Write a report to management by carefully analyzing the following comments made by the Finance…

A: Since you have posted a question with multiple sub-parts, we will solve first three sub-parts for…

Q: My text book is Hospitality Industry Financial Accounting (4th edition). I am in chapter 11 --…

A: A capitalized cost is considered to be a part of fixed asset, instead of considering it as an…

Q: Manny Company uses many kinds of machines in its operations. The following information relates to a…

A: Capital expenditures are funds used by a company to purchase, update or upgrade, and maintain fixed…

Q: At December 31, 2022, Flounder Company reported the following as plant assets. Land Buildings Less:…

A: Journal Entry - Journal entry is the recording of business transaction in books of account, this is…

Q: Cullumber Mart and Ivanhoe Shop are two companies of roughly the same size both running a chain of…

A: RETURN ON INVESTMENTReturn on investment is one of the profitability ratios which shows how much…

Q: JAT

A: VAT means value added tax. Since it’s levied on the value of the item, it’s called VAT. However, VAT…

Q: The following balances were taken from the trial balance of BJ Traders on 28 February 2013. DETAILS…

A: Financial statements of the company includes income statement, balance sheet and cash flow…

Q: Required information [The following information applies to the questions displayed below.] Karane…

A: Section 179 Deduction and Modified Accelerated Cost Recovery System (MACRS) Depreciation:The…

Q: Hot Stone Creamery sold ice cream equipment for $14,800. Hot Stone originally purchased the…

A: A depreciable asset may be sold either at gain or loss or sometimes neither at gain nor loss. If the…

Q: Good Call is a delivery business that provides its services in cash and on credit. It has a large…

A: The Net profit/loss should be calculated by deducting all the expenses from the revenue which are…

Q: [The following information applies to the questions displayed below.] Karane Enterprises, a…

A: Businesses are able to deduct costs associated with purchasing physical assets particularly for use…

Q: (A) The Martha Corporation had equipment with a cost of $60,000 and book value of $35,000 that she…

A: ANSWER consider the two situation independently is

Question

What is the correct journal entry for the following transaction?

A firm sells a car for $40 cash. The cost of the car is $30 and it has accumulated depreciation of $20.

The firm is a business consulting firm, and the car is therefore classified as property, plant & equipment.

Assets
Cash +40
PP&E (net) -30
Assets
Cash +40
PP&E (net) -10
Assets
Cash +40
Inventory -30
Assets
Cash +40
PP&E (net) -10
Liabilities
Liabilities
Liabilities
Liabilities
Owner's Equity
Gain +10
Owner's Equity
Loss -30
Owner's Equity
Revenue +40
COGS -30
Owner's Equity
Gain +30

Definition Definition Method of recording financial transactions in the book of original entry by debiting and crediting the accounts affected by a transaction using the golden rules of accrual accounting.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Introduction:

VIEW

Answer:

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Financial Reporting in Hyperinflationary Economies

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Required information [The following information applies to the questions displayed below.] Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2020. In the process of setting up the business, Karane has acquired various types of assets. Below is a list of assets acquired during 2020: Asset Office furniture. Machinery Used delivery truck* *Not considered a luxury automobile. During 2020, Karane was very successful (and had no §179 limitations) and decided to acquire more assets in 2021 to increase its production capacity. These are the assets acquired during 2021: Cost $ 300,000 1,590,000 70,000 Asset Computers and information system Luxury autot Assembly equipment Storage building Description Office furniture Machinery Used delivery truck Total $ Date Placed in Service 02/03/2020 07/22/2020 08/17/2020 Cost $430,000 tUsed 100% for business purposes. Karane generated taxable income in 2021 of $1,770,000 for purposes of computing the §179…
Dengar
Please see attached pictures. How much is the total assets in the statement of financial position as of December 31, 2022?
John purchased a truck to be used in the business for its market value or $35,000. Which fundamentals require John to record the truck at the price to buy it? A. Monetary unit assumption B. Revenue principle C. Historical cost principle D. Separate entity assumption
If a business has several types of long-lived assets such as equipment, buildings, and trucks, there should be only one accumulated depreciation account. there should be separate accumulated depreciation accounts for each type of long-lived asset. all the long-lived asset accounts will be recorded in one general ledger account. there is no need for an accumulated depreciation account. a Ob Oc Od
Is this correct?
Munabhai
please ask within 30 minutes.
Required Information [The following information applies to the questions displayed below.] Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2018. In the process of setting up the business, Karane has acquired various types of assets. Below is a list of assets acquired during 2018: Office furniture Machinery Used delivery truck* *Not considered a luxury automobile. During 2018, Karane was very successful (and had no §179 limitations) and decided to acquire more assets in 2019 to Increase its production capacity. These are the assets acquired during 2019: Asset Computers & info. system Luxury autot Assembly equipment Storage building Asset Description 2018 Assets Office furniture Machinery Used delivery truck Totals 2019 Assets Computers & Info. System Luxury Auto Assembly Equipment Storage Building Cost $ 150,000 1,560,000 40,000 tUsed 100% for business purposes. Karane generated taxable income in 2019 of $1,732,500 for purposes of…
What kinds of risks does a firm like Amazon.com face with respect to safeguarding its assets? • What types of controls do you think it already has in place to minimize these risks? Go to the firm's website and click on "Investor Relations." You'll be able to find the firm's annual report to help you answer these questions. • Are any specific controls mentioned in the annual report? • What depreciation method does Amazon use for property and equipment?
Don't give solution in image format..