Belltone Company made the following expenditures related to its 10-year-old manufacturing facility: 1. The heating system was replaced at a cost of $250,000. The cost of the old system was not known. The company accounts for improvements as reductions of accumulated depreciation. 2. A new wing was added at a cost of $750,000. The new wing substantially increases the productive capacity of the plant. 3. Annual building maintenance was performed at a cost of $14,000. 4. All of the equipment on the assembly line in the plant was rearranged at a cost of $50,000. The rearrangement clearly increases the productive capacity of the plant. Required: Prepare journal entries to record each of the above expenditures.

Belltone Company made the following expenditures related to its 10-year-old manufacturing facility: 1. The heating system was replaced at a cost of $250,000. The cost of the old system was not known. The company accounts for improvements as reductions of accumulated depreciation. 2. A new wing was added at a cost of $750,000. The new wing substantially increases the productive capacity of the plant. 3. Annual building maintenance was performed at a cost of $14,000. 4. All of the equipment on the assembly line in the plant was rearranged at a cost of $50,000. The rearrangement clearly increases the productive capacity of the plant. Required: Prepare journal entries to record each of the above expenditures.

Name: Belltone Company made the following expenditures related to its 10-yea
Uploaded: 2024-03-05T11:50:36.000Z
Channel: Bartleby
Description: Belltone Company made the following expenditures related to its 10-year-old manufacturing facility: 1. The heating system was replaced at a cost of $250,000. The cost of the old system was not known. The company accounts for improvements as reduction

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 4PB: During the current year, Arkells Inc. made the following expenditures relating to plant machinery. ...

See similar textbooks

Similar questions

During the current year, Arkells Inc. made the following expenditures relating to plant machinery. Renovated five machines for $100,000 to improve efficiency in production of their remaining useful life of five years Low-cost repairs throughout the year totaled $70,000 Replaced a broken gear on a machine for $10,000 A. What amount should be expensed during the period? B. What amount should be capitalized during the period?
Belltone Company made the following expenditures related to its 10-year-old manufacturing facility: The heating system was replaced at a cost of $230,000. The cost of the old system was not known. The company accounts for improvements as reductions of accumulated depreciation. A new wing was added at a cost of $830,000. The new wing substantially increases the productive capacity of the plant. Annual building maintenance was performed at a cost of $20,500. All of the equipment on the assembly line in the plant was rearranged at a cost of $52,000. The rearrangement clearly increases the productive capacity of the plant. Required:Prepare journal entries to record each of the above expenditures
Belltone Company made the following expenditures related to its 10-year-old manufacturing building: The heating system was replaced at a cost of $245,000. The cost of the old system was not known. The company accounts for improvements as reductions of accumulated depreciation. A new wing was added at a cost of $860,000. The new wing substantially increases the productive capacity of the building. Annual building maintenance was performed at a cost of $23,500. All of the equipment on the assembly line in the building was rearranged at a cost of $58,000. The rearrangement clearly increases the productive capacity of the equipment. Required: Prepare journal entries to record each of the above expenditures. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
During the current year, Arkells Inc. made the following expenditures relating to plant machinery. • Renovated seven machines for $250,000 to improve efficiency in production of their remaining useful life of eight years • Low-cost repairs throughout the year totaled $79,000 • Replaced a broken gear on a machine for $6,000 A. What amount should be expensed during the period? B. What amount should be capitalized during the period?
Donovan Resources Group has been in its plant facility for 15 years. Although the plant is quite functional, numerous repair costs are incurred to maintain it in sound working order. The company’s plant asset book value is currently $800,000, as indicated below. Original cost $1,200,000 Accumulated depreciation 00400,000 Book value $0800,000 During the current year, the following expenditures were made to the plant facility. a. Because of increased demands for its product, the company increased its plant capacity by building a new addition at a cost of $270,000. b. The entire plant was repainted at a cost of $23,000. c. The roof was an asbestos cement slate. For safety purposes, it was removed and replaced with a wood shingle roof at a cost of $61,000. Book value of the old roof was $41,000. d. The electrical system was completely updated at a cost of $22,000. The cost of the old electrical system was not known. It is estimated that the useful life of…
During 2006, Fox company made the following expenditures relating to plant machinery and equipment. Renovation of a group of machines at a cost of $50,000 to secure greater efficiency in production over their remaining 5- year useful lives. The project was completed on December 31, 2006. Continuing, frequent, and low cost repairs at a cost of $35,000. A broken gear on a machine was replaced at a cost of $5,000. What total amount should be charged to repairs and maintenance in 2006? A. $35,000 B. $40,000 C. $85,000 D. $90,000
During the year just ended, Morton Company made the following expenditures relating to its plant building: Continuing and frequent repairs P1,600,000 Repainted the plant building 400,000 Major improvements to the electrical wiring system 1,280,000 Partial replacement of roof tiles 560,000 How much should be charged to repair and maintenance expense during the year just ended?
el Salalak Company incurred the following plant asset expenditures and receipts in its first year of operations. The purchase price of the land was RO 285,000. The cost of filling the land was RO 15,000. Cost of demolishing an old building on the land to make land suitable for construction of new factory RO 10,000. Proceeds from salvage of the materials from the old building totalled RO 4,000. Full payment to factory construction contractor RO 300,000. Real estate taxes on land paid at time of purchase RO 4,500. Architect's fees on factory design plans RO8,500. Cost of the fences, parking lots and driveways RO 30,000. What is the total cost of the factory building? Moh O a. RO 314,000 12 O b. None of the options are correct Oc RO 310,500 O d. RO 308,500 10 O e. RO 306,000
Larkspur Utilities Corporation incurred the following costs in constructing a new maintenance building during the fiscal period: Direct labour costs incurred up to the point when the building is in a condition necessary for use as management intended, but before Larkspur begins operating in the building, $81,700 Additional direct labour costs incurred before Larkspur begins operating in the building, $5,770 Material purchased for the building, $82,500 Interest on the loan to finance construction until completion, $2,890 Allocation of variable plant overhead based on labour hours worked on the building, $34,000 f. Architectural drawings for the building, $7,750 Allocation of the president's salary, $56,700 a. b. C. d. e. g. What costs should be included in the cost of the new building if Larkspur prepares financial statements in accordance with IFRS? With ASPE? (Assume that, if there is no specific guidance from GAAP, Larkspur's management would consider a building ready for productive…
Demmert Manufacturing incurred the following expenditures during the current fiscal year: annual maintenance on its equipment, $5,400; remodeling of offices, $22,000; rearrangement of the shipping and receiving area resulting in an increase in productivity, $35,000; addition of a security system to the manufacturing facility, $25,000. How should Demmert account for each of these expenditures?
During the current fiscal year, a company made the following expenditures: -Spent $50,630 to overhaul a machine. The overhaul enabled the machine to produce more products per hour than it previously had produced. -Spent $7,511 to replace a defective compressor. The new compressor had no impact on the useful life, efficiency, or productivity of the machine on which it is a component. -Spent a total of $39,551 on a series of low cost repairs. How much should the company capitalize?
Required: 1. Prepare a differential analysis as of November 8 comparing operations using the present machine (Alternative 1) with operations using the new machine (Alternative 2). The analysis should indicate the differential profit that would result over the six-year period if the new machine is acquired. If an amount is zero, enter "0". If required, use a minus sign to indicate a loss. Differential Analysis Continue with Old Machine (Alt. 1) or Replace Old Machine (Alt. 2) November 8 Continue with Replace Differential Old Machine Old Machine Effects (Alternative 1) (Alternative 2) (Alternative 2) Revenues Proceeds from sale of old machine Costs Purchase price Annual manufacturing costs (6 yrs.) Profit (loss) 2. What other factors should be considered before a final decision is reached? a. Are there any improvements in the quality of work turned out by the new machine? b. What opportunities are available for the use of the funds required to purchase the new machine? c. Are there any…