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Accounting
On Oct 5 Install new wiring throughout the building at a cost of 30,000. It is expected that the life of the building will be extended as a result.
Oct 6 Sold an old truck with the cost of 11,000 and accumulated depreciation prior to the current year of 9,600 for 1,000. Depreciation has been recorded at the rate of 1,800 a year but has not yet been recorded for 20xx. Oct 10 traded in old office equipment for new office equipment listing at 3200. The cost of the old equipment was 3,000, and accumulated depreciation through the data of trade was 200. Received a 2,900 trade-in allowance and paid the balance in cash. The accounting method is used. Oct 17 Purchased for cash a fax machine for the office. The list price was 790 but 15% trade discount eas received. Oct 31 Recorded depreciationon the truck purcahsed on August 14. The units-of-production method is used. The truck has a useful life od 50,000 miles and a salvage value of 2000. It was driven 1.100 miles in August. |
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How would you journalize these?
Post back. |
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Dr. Building 30,000
Cr. Cash 30,000 Autombile Old DR 11000 Acc. Dr. 9,600 Autombile cr. 2800 Depreciation Cr. 1800 Man I'm having trouble, This is driving me crazy. I can't understand. I have read and I still can't get. |
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 Originally Posted by kizzyb
Originally Posted by kizzyb
You must record depreciation for this year. Dr. Dep. Expense 900 Cr. Acc. Dep 900 Now, you sold it for $1,000, so you need to whipe it off your books Dr. Cash 100 Dr. Acc. Dep 9,600+900=10,500 Cr. Old Truck 11,000 Cr. Gain on sale of truck 500 (100+10,500=11,500-11,000) You can also combine the 2 journal entries…. Dr. Dep. Expense 900 Dr. Cash 100 Dr. Acc. Dep 9,600 Cr. Old Truck 11,000 Cr. Gain on sale of truck 500 (100+10,500=11,500-11,000) Remember: When you INCREASE as asset, you debit it. When you DECREASE it, you credit it. |
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