At December 31, 2022, Swifty Company reported the following as plant assets. Land $ 3,980,000 Buildings $28,210,000 Less: Accumulated depreciation—buildings 13,200,000 15,010,000 Equipment 48,670,000 Less: Accumulated depreciation—equipment 4,980,000 43,690,000 Total plant assets $62,680,000 During 2023, the following selected cash transactions occurred. April 1 Purchased land for $2,200,000. May 1 Sold equipment that cost $840,000 when purchased on January 1, 2019. The equipment was sold for $504,000. June 1 Sold land purchased on June 1, 2013 for $1,450,000. The land cost $399,000. July 1 Purchased equipment for $2,480,000. Dec. 31 Retired equipment that cost $491,000 when purchased on December 31, 2013. 1. Journalize 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. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) 2. Record adjusting entries for depreciation for 2023. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) 3. Prepare the plant assets section of Swifty’s balance sheet at December 31, 2023. (List Plant Assets in order of Land, Buildings and Equipment.)

Financial Reporting, Financial Statement Analysis and Valuation

8th Edition

ISBN:9781285190907

Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Chapter8: Investing Activities

Section: Chapter Questions

Problem 1.3AIC: Estimate the average total estimated useful life of depreciable property, plant, and equipment....

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At December 31, 2022, Swifty Company reported the following as plant assets.

Land		$ 3,980,000
Buildings	$28,210,000
Less: Accumulated depreciation—buildings	13,200,000	15,010,000
Equipment	48,670,000
Less: Accumulated depreciation—equipment	4,980,000	43,690,000
Total plant assets		$62,680,000

During 2023, the following selected cash transactions occurred.

April 1		Purchased land for $2,200,000.
May 1		Sold equipment that cost $840,000 when purchased on January 1, 2019. The equipment was sold for $504,000.
June 1		Sold land purchased on June 1, 2013 for $1,450,000. The land cost $399,000.
July 1		Purchased equipment for $2,480,000.
Dec. 31		Retired equipment that cost $491,000 when purchased on December 31, 2013.

1. Journalize 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. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

2. Record adjusting entries for depreciation for 2023. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

3. Prepare the plant assets section of Swifty’s balance sheet at December 31, 2023. (List Plant Assets in order of Land, Buildings and Equipment.)

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