720 PART 4 Specialized Accounting Procedures for Merchandising Businesses and Partnerships $102,000 5,000 (c) Five-thousand-square-foot building: Purchase price 10,000 Real estate fees Land on which building is located Legal fees related to purchase Taxes related to purchase Interest on mortgage to buy building STRAIGHT-LINE, DECLINING-BALANCE, AND SUM-OF-THE-YEARS'-DIGITS METHODS A light truck is purchased on January 1 at a cost of $19,000. Ir in expected to serve for five years and have a salvage value of $1,000. Calculate s depreciation expense for the first and third years of the truck's life using the following 600 ble 800 300 E 18-2B / Year 1: SL: $3,600 / DDB: $7,600 / SYD: $6,000 (LO3) , methods: 1. Straight-line 2. Double-declining-balance 3. Sum-of-the-years'-digits UNITS-OF-PRODUCTION METHOD The truck purchased in Exercise 18-2B is expected to be used for 100,000 miles over its five-year useful life. Using the units- of-production method, calculate the depreciation expense for the first and third years of use if the truck is driven 18,000 miles in year 1 and 22,000 miles in year 3. E 18-3B (LO3) / Depr. exp. for year 1: $3,240 JOURNAL ENTRIES: REPAIRS, MAINTENANCE, ADDITIONS, IMPROVEMENTS, AND REPLACEMENTS Enter the following transactions for Larry's Lawn Service in a general journal: 1. Added a second mower deck to Tractor A for $550 cash to decrease mowing E 18-4B (L04) time. 2. Replaced the engine in Mower D for $200 cash. The replacement is expected to extend the life of the mower. 3. Lubricated engine of Tractor A for $25 cash (normal maintenance). LO5) $300 o gain/loss : Gain, $100 2(a): Gain, $2,500 / 2(b): Loss, $2,500 JOURNAL ENTRIES: DISPOSITION OF PLANT ASSETS Prepare the entries for the following transactions using a general journal: 1. Discarding an asset. (a) On January 4, shelving units, which had a cost of $7,200 and accumulated depreciation of $6,900, were discarded. (b) On June 15, a hand cart, which had a cost of $2,500 and accumulated depreciation of $2,250, was sold for $250. (c) On October 1, a copy machine, which had a cost of $5,200 and accumu- lated depreciation of $4,800, was sold for $500. 2. Exchange or trade-in of assets. (a) On December 31, a drill press, which had a sost of lated depreciation of $37 c00