The following balances appeared in the books of Santiago Traders on 1 March 2020: Land and Buildings 900 00 Vehicles 250 000 Machinery 200 000 Accumulated Depreciation on Vehicies Accumulated Depreciation on Machinery Additional information: Anew building was purchased for cash on the 1" September 2020 for R1 000 000. The vehicles balance at 1 March 2020 consists of two vehicles. Vehide A with a cost price o R120 000 was sold on the 31" October 2020 on credit to Miss Smith for R60 000. The vehicle was purchased on the 31 May 2018. Vehicle B was purdchased on the 1 March 2019 Purchased a new delivery vehicle (Vehicle C) for R345 000 on credit from NEN Motors on : December 2020 All machinery was purchased on the 30 April 2017 The depreciation policy on nencurrent assets are as follows: Vehides: 20% on cost using the straight-line method and no residual value Machinery: 10% per annum using the diminishing balance method and no residual value IGNORE VAT Santiago Traders has a 28 February year end

The following balances appeared in the books of Santiago Traders on 1 March 2020: Land and Buildings 900 00 Vehicles 250 000 Machinery 200 000 Accumulated Depreciation on Vehicies Accumulated Depreciation on Machinery Additional information: Anew building was purchased for cash on the 1" September 2020 for R1 000 000. The vehicles balance at 1 March 2020 consists of two vehicles. Vehide A with a cost price o R120 000 was sold on the 31" October 2020 on credit to Miss Smith for R60 000. The vehicle was purchased on the 31 May 2018. Vehicle B was purdchased on the 1 March 2019 Purchased a new delivery vehicle (Vehicle C) for R345 000 on credit from NEN Motors on : December 2020 All machinery was purchased on the 30 April 2017 The depreciation policy on nencurrent assets are as follows: Vehides: 20% on cost using the straight-line method and no residual value Machinery: 10% per annum using the diminishing balance method and no residual value IGNORE VAT Santiago Traders has a 28 February year end

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter11: Depreciation, Depletion, Impairment, And Disposal

Section: Chapter Questions

Problem 19P

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On 2 January 2019, Johnston Ltd purchased a machine with a list price of $234 300 and credit terms of 2/10, n/30. Payment was made within the discount period. Freight costs of $5400 and installation costs of $5280 were also paid. The machine has a useful life of 4 years and a residual value at the end of its useful life of $24 000. Ignore GST. Required Determine the amount that should be debited to the machinery account and prepare a general journal entry to record the purchase, assuming a financial year ending 31 December. Determine the amount of depreciation expense for each of the 4 years ending 31 December assuming use of: the straight-line depreciation method the diminishing balance method of depreciation.
The following trial balance was extracted from the ledger of Juliana at 31 December 2020.JulianaTrial Balance as at 31 December 2020RMRMLand at cost26,000Plant at cost83,000Accumulated Depreciation at 1 January 2020- Plant13,000Office Equipment33,000Accumulated Depreciation at 1 January 2020Office Equipment8,000Receivables198,000Payables52,000Sales763,000Purchases516,000Returns inwards47,000Discount allowed4,000Capital at 1st January 2020230,000Drawings14,000Provision for doubtful debts at 1 January 202023,000Salaries Expense44,000Administration costs38,000Bank75,000Bad debts written off77,000Inventory at 1 January 202084,0001,164,0001,164,000Additional information: Closing inventory is RM74,000. Depreciation on plant is charged at 10% per annum on cost. Depreciation on office equipment is charged at 20% per annum using the reducing balance method. Administration costs include insurance prepaid of RM3,000. Salary accrued amount to RM2,000. The allowance for receivables is to…
A computer is sold on 1 June 2022. The details are as follows: (i) Cost $11,000 (being $10,000 plus $1000 GST) (ii) Accumulated Depreciation 1/7/2021 $4,000 (iii) Depreciation Method - Prime cost, 24% (iv) Consideration/sale proceeds of $3,000 (GST excl) which has been posted already from client to the computer asset account and has to be re-allocated). Prepared the required entries to correctly accouny for the disposal including depreciation up to the time of sale.
Hybrid dealers bought computer equipment for 54000 on 1 July 2018. The equipment is depreciated at 20% according to diminishing balance method. Required: Prepare the depreciation and closing transfer entries in the general journal of Hybrid dealers on 31 March 2019 and 31 March 2020.
n 2020, Staged Home Ltd. completed the following transactions involving delivery trucks: July 5 Traded in an old truck and paid $19,600 in cash for furniture. The accounting records on July 5 showed the cost of the old truck at $43,500 and related accumulated depreciation of $7,250. The furniture was estimated to have a six-year life and a $8,268 trade-in value. The invoice for the exchange showed these items: Price of the furniture (equal to its fair value) $ 50,100 Trade-in allowance (30,500 ) Total paid in cash $ 19,600 Dec. 31 Recorded straight-line depreciation on the furniture (to nearest whole month). Required:Prepare journal entries to record the transactions. 1) Record the exchange 2) Record the depreciation
The following balances were extracted from the books of Billion Precision for the year ended 31 December 2020. Dr (RM) Cr (RM) Land 500000 Building 200000 Motor vehicles 120000 Plant and machinery 70000 Profit b/f as at 01.01.2020 237650 Capital 438000 Acc depreciation as at 1.1.2020 : Dr (RM) Cr (RM) Building 60 000 Motor vehicles 69250 Plant and machinery 40000 Returns 3600 4100 Revenue 800000 Purchases 400000 Discounts 5000 Carriage Inwards 7700 Opening Inventory 52000 Provision for bad debts 2000 Trade receivables / Trade payable 66000 43200 Advertising 18000 Staff training course 4000 Bad Debts 12500 Motor Expenses 27000 Rental 90000 Bank 7600 Wages & Salaries 126000 1701800 1701800 Additional information:i. The provision for bad debts should be 4% of trade receivables.ii. Depreciation is to be charged as follows:-Buildings 2% on cost.-Plant and machinery 20% on…
These are the books of Riya Distributers as at 28 February 2021.Equipment R20 000, Accumulated Depreciation R16 000. Depreciation is calculated at 20% p. a. ona diminishing method. An old equipment was disposed for R1 500 cash on 1 December 2020. Theequipment originally costed R3 000. The Accumulated depreciation is R 700.The depreciation for the disposed equipment is
On January 1, 2020, Mustafa Sultan Company sold printer for RO10,000 cash. The printer originally cost RO 35,000. As of January 1, 2020, it had accumulated depreciation of RO 32,000. Prepare the journal entry to record the sales of the printer Select one: O a. Truck 35,000 Gain on disposal of truck 7,000 cash 10,000 Accumulated Depreciation 32,000 O b. 35,000 Accumulated Depreciation Equipment 35,000 C. Accumulated Depreciation 32,000 ill lis iSI 直 0
On January 1, 2020, Techno Company sold a machine for RO15,000 cash. The Machine originally cost RO 56,000. As of January 1, 2020, it had accumulated depreciation of RO 35,000. Prepare the journal entry to record the sales of the Machine Select one: О. 15,000 35,000 Cash Accumulated Depreciation Loss on disposal of Machine Machine 6,000 56,000 O b. Accumulated Depreciation 35,000 Equipment 35,000 O c. Truck 56,000 直。 كتب هنا ل لبحث
4. Below are the machinery bought buy Budweiser using cheque from year 2018 to 2020. Date of Purchase Cost (RM) Machine AA 1 January 2018 20,000 Machine BB 1 March 2018 50,000 Machine DD 1 November 2018 10,000 Machine EE 1 May 2020 8,000 Depreciation is over ten years, using the straight line method at annual depreciation rate of 8%. Depreciation policy states that full depreciation is made on non-current assets owned for more than six months in a financial year. Required: Prepare: (a) The journal entries for the above transaction (b) The Machinery Account (c) The Depreciation Account (d) The provision for Depreciation Account
These are the books of Riya Distributers as at 28 February 2021.Equipment R20 000, Accumulated Depreciation R16 000. Depreciation is calculated at 20% p. a. ona diminishing method. An old equipment was disposed for R1 500 cash on 1 December 2020. Theequipment originally costed R3 000. The Accumulated depreciation is R 700.The profit/loss for the disposed equipment is
4. Prepare journal entry on January 1, 2027 to record the return of the machinery to the lessor. Assume thefair value of the asset is P300,000