The following transactions and adjusting entries were completed by a local delivery company called Super Swift. The company uses straight line depreciation for delivery vehicles, and double declining balance depreciation for buildings, and straight line amortization for franchise rights.
| January 2, 2010 |
Paid $77,000 cash to purchase a small warehouse building near the airport. The building has an estimated life of 20 years, and a residual value of $20,000. |
| July 1, 2010 |
Paid $30,200 cash to purchase a delivery van. The van has an estimated useful life of five years, and a residual value of $7,200. |
| October 2, 2010 |
Paid $420 cash to paint a small office in the warehouse building. |
| October 13, 2010 | Paid $170 cash to get the oil changed in the delivery van. |
| December 1, 2010 |
Paid $78,000 cash to UPS to begin operating Super Swift business as a franchise using the name The UPS Store. This franchise right expires in five years. |
| December 31, 2010 |
Recorded depreciation and amortization on the delivery van, warehouse building, and franchise right. |
| June 30, 2011 |
Sold the warehouse building for $65,725 cash. (Record the depreciation on the building prior to recording its disposal.) |
| December 31, 2011 |
Recorded depreciation on the delivery van and amortization on the franchise right. Determined that the franchise right was not impaired in value. |
Give the journal entries required on each of the above dates
| Jan. 2 | (Click to select)Gain on disposalVehiclesCashEquipmentLandBuildingLoss on disposalFranchise rights | ||
| (Click to select)Gain on disposalLandCashVehiclesLoss on disposalFranchise rightsEquipmentBuilding | |||
| July 1 | (Click to select)BuildingCashFranchise rightsLoss on disposalEquipmentVehiclesGain on disposalLand | ||
| (Click to select)Loss on disposalCashGain on disposalFranchise rightsEquipmentLandVehiclesBuilding | |||
| Oct 2 | (Click to select)CashFranchise rightsNotes payableRepairs and maintenance expenseDepreciation expenseBuildingAccounts payableLand | ||
| (Click to select)Notes payableAccounts payableCashLandBuildingRepairs and maintenance expenseDepreciation expenseVehicles | |||
| Oct 13 | (Click to select)Depreciation expenseAccounts payableRepairs and maintenance expenseFranchise rightsCashAmortization expenseAccumulated depreciationAccounts receivable | ||
| (Click to select)Accumulated depreciationAccounts receivableRepairs and maintenance expenseCashDepreciation expenseAccounts payableFranchise rightsAmortization expense | |||
| Dec 1 | (Click to select)VehiclesLandNote payableBuildingDepreciation expenseFranchise rightsCashAccumulated depreciation | ||
| (Click to select)CashNote payableLandVehiclesBuildingDepreciation expenseAccumulated depreciationFranchise rights | |||
| Dec. 31 | (Click to select)Accumulated depreciation vehiclesAmortization expenseCashDepreciation expenseFranchise rightsAccumulated depreciation bldg.Gain on disposal Loss on disposal | ||
| (Click to select)Gain on disposal CashFranchise rightsAccumulated depreciation vehiclesAmortization expenseAccumulated depreciation bldg.Loss on disposal Depreciation expense | |||
| (Click to select)Depreciation expenseLoss on disposalGain on disposal Amortization expenseCashAccumulated depreciation vehiclesFranchise rightsAccumulated depreciation bldg. | |||
| (Click to select)Depreciation expenseAccumulated depreciation bldg.Accumulated depreciation vehiclesGain on disposal Franchise rightsCashLoss on disposalAmortization expense | |||
| (Click to select)Depreciation expenseCashAmortization expenseAccumulated depreciation bldg.Gain on disposal Franchise rightsLoss on disposalAccumulated depreciation vehicles | |||
| 2011 | |||
| June 30 | (Click to select)Accounts receivableAccumulated depreciation vehiclesAccumulated depreciation bldg.Depreciation expenseLoss on disposalAmortization expenseFranchise rightsBuilding | ||
| (Click to select)Accumulated depreciation bldg.Loss on disposalFranchise rightsAccumulated depreciation vehiclesBuildingDepreciation expenseAccounts receivableAmortization expense | |||
| June 30 | (Click to select)Loss on disposalFranchise rightsVehiclesImpairment lossGain on disposal CashAccumulated depreciation bldg.Accumulated depreciation vehicles | ||
| (Click to select)Accumulated depreciation bldg.Accumulated depreciation vehiclesGain on disposal Franchise rightsCashVehiclesLoss on disposalImpairment loss | |||
| (Click to select)Accumulated depreciation vehiclesImpairment lossGain on disposal VehiclesAccumulated depreciation bldg.Franchise rightsCashLoss on disposal | |||
| (Click to select)Accumulated depreciation bldg.Accounts payableCashLoss on disposalAmortization expenseBuildingDepreciation expenseAccounts receivable | |||
| Dec. 31 | (Click to select)Impairment lossFranchise rightsAmortization expenseCashDepreciation expenseAccumulated depreciation bldg.BuildingAccumulated depreciation vehicles | ||
| (Click to select)Amortization expenseDepreciation expenseAccumulated depreciation bldg.Franchise rightsAccumulated depreciation vehiclesBuildingCashImpairment loss | |||
| (Click to select)Accumulated depreciation bldg.BuildingAccumulated depreciation vehiclesCashFranchise rightsAmortization expenseImpairment lossDepreciation expense | |||
| (Click to select)BuildingImpairment lossAccumulated depreciation bldg.Amortization expenseCashDepreciation expenseAccumulated depreciation vehiclesFranchise rights | |||
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