Question : Question Exercise 10-24 $3,035,500 840,600 $2,194,900 Depreciation computed at $140,100 per year a straight-line basis. Presented : 1162488

Question

Exercise 10-24

$3,035,500

840,600

$2,194,900

Depreciation is computed at $140,100 per year on a straight-line basis.

Presented below is a set of independent situations. For each independent situation, indicate the journal entry to be made to record the transaction. Make sure that depreciation entries are made to update the book value of the machine prior to its disposal.

On April 1, 2015, Tritt sold the machine for $2,428,400 to Dwight Yoakam Company. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select “No Entry” for the account titles and enter 0 for the amounts.)

Date

Account Titles and Explanation

Debit

Credit

(To record current depreciation.)

(To record sale of the machine.)

On July 31, 2015, the company donated this machine to the Mountain King City Council. The fair value of the machine at the time of the donation was estimated to be $2,568,500. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select “No Entry” for the account titles and enter 0 for the amounts.)

Date

Account Titles and Explanation

Debit

Credit

(To record current depreciation.)

(To record donation of the machine.)

Exercise 10-24

On December 31, 2014, Travis Tritt Inc. has a machine with a book value of $2,194,900. The original cost and related accumulated depreciation at this date are as follows.

Machine

$3,035,500

Less: Accumulated depreciation

840,600

Book value

$2,194,900

Depreciation is computed at $140,100 per year on a straight-line basis.

Presented below is a set of independent situations. For each independent situation, indicate the journal entry to be made to record the transaction. Make sure that depreciation entries are made to update the book value of the machine prior to its disposal.

On April 1, 2015, Tritt sold the machine for $2,428,400 to Dwight Yoakam Company. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select “No Entry” for the account titles and enter 0 for the amounts.)

Date

Account Titles and Explanation

Debit

Credit

April 1, 2015

(To record current depreciation.)

April 1, 2015

(To record sale of the machine.)

On July 31, 2015, the company donated this machine to the Mountain King City Council. The fair value of the machine at the time of the donation was estimated to be $2,568,500. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select “No Entry” for the account titles and enter 0 for the amounts.)

Date

Account Titles and Explanation

Debit

Credit

July 31, 2015

(To record current depreciation.)

July 31, 2015

(To record donation of the machine.)