Problem 9 2A
At December 31, 2014, Navaro Corporation reported the following plant assets.
Land $ 5,151,000
Buildings $29,420,000
Less: Accumulated depreciation—buildings 20,475,225 8,944,775
Equipment 68,680,000
Less: Accumulated depreciation—equipment 8,585,000 60,095,000
Total plant assets $74,190,775
During 2015, the following selected cash transactions occurred.
Apr. 1 Purchased land for $3,777,400.
May 1 Sold equipment that cost $1,030,200 when purchased on January 1, 2008. The equipment was sold for $291,890.
June 1 Sold land for $2,747,200. The land cost $1,717,000.
July 1 Purchased equipment for $1,888,700.
Dec. 31 Retired equipment that cost $1,201,900 when purchased on December 31, 2005. No salvage value was received.
Journalize the transactions. Navaro uses straight line depreciation for buildings and equipment. The buildings are estimated to have a 40 year useful life and no salvage value; the equipment is estimated to have a 10 year useful life and no salvage value. Update depreciation on assets disposed of at the time of sale or retirement. (Record entries in the order displayed in the problem statement. Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Date Account Titles and Explanation Debit Credit
(To record depreciation on equipment sold)
(To record depreciation on equipment retired)
SHOW LIST OF ACCOUNTS
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Record adjusting entries for depreciation for 2015. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Date. Account Titles and Explanation Debit Credit
Dec. 31
(To record depreciation on buildings.)
31
SHOW LIST OF ACCOUNTS
LINK TO TEXT
LINK TO VIDEO
Prepare the plant assets section of Navaro’s balance sheet at December 31, 2015. (Hint: You may wish to set up T accounts, post beginning balances, and then post 2015 transactions.) (List Plant Assets in order of Land, Building and Equipment.)
NAVARO CORPORATION
Partial Balance Sheet
December 31, 2015
$
$
:
:
$
SHOW LIST OF ACCOUNTS
LINK TO TEXT
LINK TO TEXT
LINK TO VIDEO
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