The property, plant, and equipment section of the JasperCompany’s December 31, 2017, balance sheet contained thefollowing:
|
| Property, plant, andequipment: | | | | | | |
| Land | | | | $ | 130,000 | |
| Building | $ | 800,000 | | | | |
| Less: Accumulateddepreciation | | (250,000 | ) | | 550,000 | |
| Equipment | | 186,900 | | | | |
| Less: Accumulateddepreciation | | ? | | | ? | |
| Total property, plant, andequipment | | | | | ? | |
The land and building were purchased at the beginning of 2013.Straight-line depreciation is used and a residual value of $50,000for the building is anticipated.
The equipment is comprised of the following three machines:
| Machine | Cost | DateAcquired | | Residual Value | | Life in Years | | 101 | $ | 66,400 | | 1/1/15 | | $ | 8,000 | | | 8 | | | 102 | | 79,000 | | 6/30/16 | | | 9,000 | | | 7 | | | 103 | | 41,500 | | 9/1/17 | | | 4,000 | | | 10 | | The straight-line method is used to determine depreciation onthe equipment. On March 31, 2018, Machine 102 was sold for $49,000.Early in 2018, the useful life of machine 101 was revised to fiveyears in total, and the residual value was revised to zero.
Required: 1. Calculate the accumulated depreciation onthe equipment at December 31, 2017.
2. Prepare the journal entry to record 2018depreciation on machine 102 up to the date of sale.
3. Prepare a schedule to calculate the gain orloss on the sale of machine 102.
4. Prepare the journal entry for the sale ofmachine 102.
5. Prepare the 2018 year-end journal entries torecord depreciation on the building and equipment. |
|
