(Entries for Equipment Acquisitions) Jane Geddes EngineeringCorporation purchased conveyor equipment with a list price of$10,000. The vendors credit terms were 2/10, n/30. Presented beloware two independent cases related to equipment. Assume that thepurchases of equipment are recorded gross. (Round to nearestdollar)
a.) Geddes paid cash for the equipment 8 days after the purchase.The vendor's credit terms are 2/10, n/30. Assume equipmentpurchases are initially recorded gross.
b.) Geddes traded in equipment with a book value of $2,000 (initialcost $8,000) and paid $9,500 in case one month after the purchase.The old equipment could have been sold for $400 at the date oftrade. Assume the exchange has commercial substance.
c.) Geddes gave the vendor a $10,800 zero-interest-bearing notefor the equipment on the date of purchase. The note was due in oneyear and was paid on time. Assume that the effective-interest ratein the market was 9%
Instructions
Prepare the general journal entries required to record theacquisition and payment in cash of the independent cases above.Round to the nearest dollar.
