Yoshi Company completed the following transactions and events involving its delivery trucks. Year 1 January 1 Paid $25,015 cash plus $1,785 in sales tax for a new delivery truck estimated to have a five-year life and a $2,000 salvage value. Delivery truck costs are recorded in the Trucks account. December 31 Recorded annual straight-line depreciation on the truck. Year 2 December 31 The truck's estimated useful life was changed from five to four years, and the estimated salvage value was increased to $2,850. Recorded annual straight-line depreciation on the truck. Year 3 December 31 Recorded annual straight-line depreciation on the truck. December 31 Sold the truck for $5,400 cash. Required: 1-a. Calculate depreciation for Year 2. 1-b. Calculate book value and gain (loss) for sale of Truck on December 31, Year 3. 1-c. Prepare journal entries to record these transactions and events. Complete this question by entering your answers in the tabs below. Required 14 Required 18 Required IC Calculate depreciation for Year 2. Total cont Less accumulated depreciation rom Year 1) Book value Less revised vage value be depreciated Remaning Years of the remaining Required 1A Required 18 Required 1C Calculate book value and gain (loss) for sale of Truck on December 31, Year 3. Depreciation expense (for Year 1) Depreciation expense (for Year 2) Depreciation expense (for Year 3) Accumulated depreciation 12/31/Year 3 Book value of truck at 12/31/Year 3 Total cost Accumulated depreciation Book value 4
Yoshi Company completed the following transactions and events involving its delivery trucks. Year 1 January 1 Paid $25,015 cash plus $1,785 in sales tax for a new delivery truck estimated to have a five-year life and a $2,000 salvage value. Delivery truck costs are recorded in the Trucks account. December 31 Recorded annual straight-line depreciation on the truck. Year 2 December 31 The truck's estimated useful life was changed from five to four years, and the estimated salvage value was increased to $2,850. Recorded annual straight-line depreciation on the truck. Year 3 December 31 Recorded annual straight-line depreciation on the truck. December 31 Sold the truck for $5,400 cash. Required: 1-a. Calculate depreciation for Year 2. 1-b. Calculate book value and gain (loss) for sale of Truck on December 31, Year 3. 1-c. Prepare journal entries to record these transactions and events. Complete this question by entering your answers in the tabs below. Required 14 Required 18 Required IC Calculate depreciation for Year 2. Total cont Less accumulated depreciation rom Year 1) Book value Less revised vage value be depreciated Remaning Years of the remaining Required 1A Required 18 Required 1C Calculate book value and gain (loss) for sale of Truck on December 31, Year 3. Depreciation expense (for Year 1) Depreciation expense (for Year 2) Depreciation expense (for Year 3) Accumulated depreciation 12/31/Year 3 Book value of truck at 12/31/Year 3 Total cost Accumulated depreciation Book value 4
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
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Transcribed Image Text:Journal entry worksheet
Record the total cost of the new delivery truck
AN
General Journal
✪UN
Enter debits before credits
Date
January 01, Year 1
Debit
C
1
23
Record the year-end dusting entry for the depreciation expense of the
delivery truck.
4 5
Note: Enter debts before credits
Date
December 31, Year 1
General Journal
Debit
Credit
Journal entry worksheet
<
2
1
sote: Enter debits before credite
4
Record the year-end adjusting entry for the depreciation expense of the
delivery truck.
Date
December 31, Year
5
General Journal
Debit
Credit
<
1
2
5
85
Record the year-end adjusting entry for the depreciation expense of the
delivery truck.
tenter debts before credits.
Date
December 31, Year 3
General Journal
Debit
Credit
<
1
2
8
Record the sale of the delivery truck for $5,400 cash
Notts belo
Date
December 31, Year 3
General Journal
Debit
Credi
Transcribed Image Text:Yoshi Company completed the following transactions and events involving its delivery
trucks.
Year 1
January 1 Paid $25,015 cash plus $1,785 in sales tax for a new delivery truck
estimated to have a five-year life and a $2,000 salvage value.
Delivery truck costs are recorded in the Trucks account.
December 31 Recorded annual straight-line depreciation on the truck.
Year 2
December 31 The truck's estimated useful life was changed from five to four
years, and the estimated salvage value was increased to $2,850.
Recorded annual straight-line depreciation on the truck.
Year 3
December 31 Recorded annual straight-line depreciation on the truck.
December 31 Sold the truck for $5,400 cash.
Required:
1-a. Calculate depreciation for Year 2.
1-b. Calculate book value and gain (loss) for sale of Truck on December 31, Year 3.
1-c. Prepare journal entries to record these transactions and events.
Complete this question by entering your answers in the tabs below.
Required 1A Required 10 Required IC
Calculate depreciation for Year 2.
Total cost
Less accumulated depreciation (from Year 1)
Book value
Less revised salvage value
Remaining cost to be depreciated
Years of the remaining
Total depreciation for Year 2
Required 1A Required 18 Required 1C
Calculate book value and gain (loss) for sale of Truck on December 31, Year 3.
Depreciation expense (for Year 1)
Depreciation expense (for Year 2)
Depreciation expense (for Year 3)
Accumulated depreciation 12/31/Year 3
Book value of truck at 12/31/Year 3
Total cost
Accumulated depreciation
Book value
k
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