P10.5A Journalise a series of equipment transactions related to purchase, sale, retirement, and depreciation At December 31, 2021, Grand Regency Limited reported the following as Non-current tangible assets: 4,000,000 16,400,000 April 1 May 1 During 2022, the following selected cash transactions occurred. Purchased land for R2,130,000. June 11 July 1 Dec. 31 Land Buildings Less: Accumulated depreciation - buildings Equipment Less: Accumulated depreciation - equipment Total plant assets (b) (c) (d) 28,500,000 12,100,000 48,000,000 5,000,000 Required (a) 43,000,000 £63,400,000 Sold equipment that cost R750,000 when purchased on January 1, 2018. The equipment was sold for R450,000. Sold land purchased on June 1, 2012 for R1,500,000. The land cost R400,000. Purchased equipment for R2,500,000. Retired equipment that cost R500,000 when purchased on December 31, 2012. No salvage value was received. Prepare general journal entries the above transactions. The company uses straight-line depreciation for buildings and equipment. The buildings are estimated to have a 50-year 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. The structure of your answer (handwritten) is shown below Record adjusting entries for depreciation for 2022r answer (handwritten) is show below. Prepare the non-currents section of Grand's SoFP at December 31, 2022. Wolufu, one of the directors, while reviewing the statement of profit or loss noted figure on depreciation. Wolufu wonders loudly: what is depreciation expense and when did the company pay for it? Can someone help me? You are required to write a memo to Wolufu to explain the meaning of depreciation and when the company made payment for depreciation expense
P10.5A Journalise a series of equipment transactions related to purchase, sale, retirement, and depreciation At December 31, 2021, Grand Regency Limited reported the following as Non-current tangible assets: 4,000,000 16,400,000 April 1 May 1 During 2022, the following selected cash transactions occurred. Purchased land for R2,130,000. June 11 July 1 Dec. 31 Land Buildings Less: Accumulated depreciation - buildings Equipment Less: Accumulated depreciation - equipment Total plant assets (b) (c) (d) 28,500,000 12,100,000 48,000,000 5,000,000 Required (a) 43,000,000 £63,400,000 Sold equipment that cost R750,000 when purchased on January 1, 2018. The equipment was sold for R450,000. Sold land purchased on June 1, 2012 for R1,500,000. The land cost R400,000. Purchased equipment for R2,500,000. Retired equipment that cost R500,000 when purchased on December 31, 2012. No salvage value was received. Prepare general journal entries the above transactions. The company uses straight-line depreciation for buildings and equipment. The buildings are estimated to have a 50-year 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. The structure of your answer (handwritten) is shown below Record adjusting entries for depreciation for 2022r answer (handwritten) is show below. Prepare the non-currents section of Grand's SoFP at December 31, 2022. Wolufu, one of the directors, while reviewing the statement of profit or loss noted figure on depreciation. Wolufu wonders loudly: what is depreciation expense and when did the company pay for it? Can someone help me? You are required to write a memo to Wolufu to explain the meaning of depreciation and when the company made payment for depreciation expense
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
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Transcribed Image Text:P10.5A Journalise a series of equipment transactions related to purchase, sale, retirement, and depreciation
At December 31, 2021. Grand Regency Limited reported the following as Non-current tangible assets:
4,000,000
16,400,000
June 11
July 1
Dec. 31
Land
Buildings
Less: Accumulated depreciation - buildings
Equipment
Less: Accumulated depreciation - equipment
Total plant assets
During 2022, the following selected cash transactions occurred.
April 1
Purchased land for R2,130,000.
May 1
(b)
(c)
(d)
28,500,000
12,100,000
48,000,000
5,000,000
Required:
(a)
43,000,000
£63,400,000
Sold equipment that cost R750,000 when purchased on January 1, 2018. The
equipment was sold for R450,000.
Sold land purchased on June 1, 2012 for R1,500,000. The land cost R400,000.
Purchased equipment for R2,500,000.
Retired equipment that cost R500,000 when purchased on December 31, 2012.
No salvage value was received.
Prepare general journal entries the above transactions. The company uses straight-line depreciation for
buildings and equipment. The buildings are estimated to have a 50-year 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. The structure of your answer (handwritten) is shown below
Record adjusting entries for depreciation for 2022gr answer (handwritten) is show below.
Prepare the non-currents section of Grand's SoFP at December 31, 2022.
Wolufu, one of the directors, while reviewing the statement of profit or loss noted figure on depreciation.
Wolufu wonders loudly: what is depreciation expense and when did the company pay for it? Can someone
help me? You are required to write a memo to Wolufu to explain the meaning of depreciation and when
the company made payment for depreciation expense.
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