Maxine Company sells a tractor on January 1, 2024 for $45,000 cash. At the time of the sale, the book value of the tractor is$41,000. The original purchase price of the machine was $50,000. Which of the following would be part of the correct journalentry to record the sale of the tractor?DEBIT to Gain on Sale of Equipment of $4,000CREDIT to Equipment of $41,000CREDIT to Gain on Sale of Equipment of $4,000DEBIT to Loss on Sale of Equipment of $5,000None of the above

Accumulated depreciation = Cost - Book value. If the sale value is more than the book value, then…

Answered: Maxine Company sells a tractor on…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Francis Company purchased a machine for $24, 000; the seller is holding the note. Francis Company paid $5, 400 for improvements to extend the life of the machine. Francis Company has deducted depreciation on the machine for 3 years totaling $12,000. Francis Company owes $10,000 to the seller. What is Francis Company's adjusted basis in the machine? Group of answer choices
An asset's book value is $64,800 on January 1, Year 6. The asset is being depreciated $900 per month using the straight-line method. Assuming the asset is sold on July 1, Year 7 for $46,600, the company should record: Multiple Choice Neither a gain or loss is recognized on this type of transaction. A loss on sale of $2,000. A gain on sale of $1,000. A loss on sale of $1,000. A gain on sale of $2,000.
← On January 2, 2023, Once Again Clothing Consignments purchased showroom fixtures for $19,000 cash, expecting the fixtures to remain in service for five years. Once Again has depreciated the fixtures on a double-declining-balance basis, with zero residual value. On October 31, 2024, Once Again sold the fixtures for $8,000 cash. Record both depreciation expense for 2024 and sale of the fixtures on October 31, 2024. (Record debits first, then credits. Select the explanation on the last line of the journal entry table. Note that 2023 depreciation was recorded and posted in 2023.) Begin by recording the depreciation expense for January 1, 2024 through October 31, 2024. Accounts and Explanation Date Oct. 31 Debit Credit
1. Denver, Inc., exchanged land and cash of $8,000 for equipment. The land was purchased at $55,000 a few years ago and a fair value of $60,000. Prepare the journal entry to record the exchange. Assume the exchange has no commercial substance. 2. Metro Inc. trades its used machine for a new model at Denver Inc. The used machine has a book value of $8,000 (original cost of $12,000) and a fair value of $4,000. The new model lists for $15,000. Denver gives Metro a trade-in allowance of $7,000 for the used machine, $3,000 more than its fair value. Prepare a journal entry for Metro, assuming commercial substance.
26 Cliff Company traded in an old truck for a new one. The old truck had a cost of $77,000 and accumulated depreciation of $61,600. The new truck had an invoice price of $127,000. Huffington was given a $12,320 trade-in allowance on the old truck, which meant they paid $114,680 in addition to the old truck to acquire the new truck. If this transaction has commercial substance, what is the recorded value of the new truck? cBook keterences Multiple Choice $114,680 $130,080 $15,400 $127,000
Accounting Sleepy Ltd negotiated a purchase of land, building and equipment from Bambi Corp. The purchase was completed on June 28, 2021 at a total cash cost of $800,000. The estimated market value of each asset at the time was: land, $330,000; building, $520,000; and machinery, $150,000. Required: 1. Prepare journal entries to record each of the purchase of the assets on June 28, 2021. 2. How much depreciation will be recorded for the December 31, 2021 year end assuming declining balance depreciation years and 5 years on the machinery? Company policy is to start depreciating assets at the beginning of the month following acquisition. on the building over 40
Hot Stone Creamery sold ice cream equipment for $17,600. Hot Stone originally purchased the equipment for $94,000, and depreciation through the date of sale totaled $73,000. Record the gain or loss on the sale of the equipment. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.)
Bremer Company made the following exchanges of assets during 2019: Jan. 1 Acquired a more advanced machine worth $10,000 by paying $2,000 cash and giving up a machine that had originally cost $40,000 and has a book value of $12,000. Feb. 1 Acquired a building worth $55,000 by paying $5,000 cash and giving up a piece of land that had originally cost $35,000. Mar. 1 Acquired a more advanced machine worth $20,000 by paying $5,000 cash and giving up a machine that had originally cost $13,000 and has a book value of $11,000. Apr. 1 Acquired a car by giving up a truck that had originally cost $20,000, has a book value of $15,000, and has a "blue book" value of $16,800. In addition, the company received $1,000 cash. Required: Prepare Bremer's journal entry for each exchange. Assume all exchanges were determined to have commercial substance.
16
On May 1, 2020, Zoo Company sells furniture for 80,000 cash. The furniture originally cost 200,000 when purchased on June 1, 2013. Depreciation is recorded by the straight-line method over 10 years with a residual value of 20,000. What gain or loss should be recognized on the sale? (Indicate whether gain or loss)
None

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