Yoshi Company completed the following transactions and events involving its delivery trucks. Year 1 ...
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Accounting
Yoshi Company completed the following transactions and events involving its delivery trucks.
Year 1
January 1
Paid $23,515 cash plus $1,635 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 trucks 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 $5,500 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.
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