Question

In: Accounting

Pru & Co. purchased a vehicle for $48,000 on 1 January 2020. Its Accumulated Depreciation as...

Pru & Co. purchased a vehicle for $48,000 on 1 January 2020. Its Accumulated Depreciation as at 31 December 2023 is $28,000. The Co. uses straight line method of Depreciation. The Trademark was sold for $18,000 as at 31 December 2023 ? Pru & Co. uses calendar year accounting period. What is the result of the sale?

Solutions

Expert Solution

WORKING NOTES: 1
CALCULATION OF BOOK VALUE OF THE ASSETS AS ON 31 DECEMBER 2023
Purchase Cost of Vehicle $                      48,000
Less: Accumulated Depreciation as on Dec 2023 $                      28,000
Book Value of Vehicle as on Dec 2023 $                      20,000
SOLUTION
CALCULATION OF GAIN OR LOSS ON SALE OF VEHICLES
Sale Value of the Vehicle $                      18,000
Less : Book Value of the Vehicle as on Dec 2023 $                      20,000
Loss on sale of Vehicle $                      -2,000
Answer = There is loss of $ 2,000 on sale of Vehicle

ekkarill92 answered 2 years ago
Next > < Previous

Related Solutions

On January 1, 2020, the Accumulated Depreciation—Machinery account of Astros Company showed a balance of $370,000....
On January 1, 2020, the Accumulated Depreciation—Machinery account of Astros Company showed a balance of $370,000. At the end of 2020, after the adjusting entries were posted, it showed a balance of $395,000. During 2020, one of the machines which cost $125,000 was sold for $60,500 cash. This resulted in a loss of $4,000. Assuming that no other assets were disposed of during the year, how much was depreciation expense for 2020?
A machine cost $240,000, has annual depreciation expense of $48,000, and has accumulated depreciation of $120,000...
A machine cost $240,000, has annual depreciation expense of $48,000, and has accumulated depreciation of $120,000 on December 31, 2016. On April 1, 2017, when the machine has a fair value of $96,000, it is exchanged for a similar machine with a fair value of $288,000 and the proper amount of cash is paid. The exchange lacked commercial substance. (1) Prepare a journal entry to recognize the depreciation expense on April, 2017. (2) Prepare a journal entry to record the...
On January 1, 2020, the Vasquez SA ledger shows Equipment €32,000 and Accumulated Depreciation—Equipment €9,000. The...
On January 1, 2020, the Vasquez SA ledger shows Equipment €32,000 and Accumulated Depreciation—Equipment €9,000. The depreciation resulted from using the straight‐line method with a useful life of 10 years and a residual value of €2,000. On this date, the company concludes that the equipment has a remaining useful life of only 4 years with the same residual value. Compute the revised annual depreciation. 1) Compute the revised depreciation. a. Same facts as (1), except assume that Vasquez will use...
On January 1, 2020, a machine was purchased for $900,000 by Young Co. The machine is...
On January 1, 2020, a machine was purchased for $900,000 by Young Co. The machine is expected to have an 8-year life with no salvage value. It is to be depreciated on a straight-line basis. The machine was leased to St. Leger Inc. for 3 years on January 1, 2020, with annual rent payments of $150,955 due at the beginning of each year, starting January 1, 2020. The machine is expected to have a residual value at the end of...
Assume that, on January 1, 2016, Matsui Co. paid $1,296,000 for its investment in 48,000 shares...
Assume that, on January 1, 2016, Matsui Co. paid $1,296,000 for its investment in 48,000 shares of Yankee Inc. Further, assume that Yankee has 240,000 total shares of stock issued. The book value and fair value of Yankee's identifiable net assets were both $480,000 at January 1, 2016. The following information pertains to Yankee during 2016:      Net income $240,000   Dividends declared and paid $72,000   Market price of common stock on 12/31/2016 $29/share    What amount would Matsui report in...
At January 1, 2022, Sandhill Co. reported the following property, plant, and equipment accounts: Accumulated depreciation—buildings...
At January 1, 2022, Sandhill Co. reported the following property, plant, and equipment accounts: Accumulated depreciation—buildings $60,700,000 Accumulated depreciation—equipment 54,600,000 Buildings 97,400,000 Equipment 150,800,000 Land 21,000,000 The company uses straight-line depreciation for buildings and equipment, its year-end is December 31, and it makes adjustments annually. The buildings are estimated to have a 40-year useful life and no salvage value; the equipment is estimated to have a 10-year useful life and no salvage value. During 2022, the following selected transactions occurred:...
At January 1, 2022, Wildhorse Co. reported the following property, plant, and equipment accounts: Accumulated depreciation—buildings...
At January 1, 2022, Wildhorse Co. reported the following property, plant, and equipment accounts: Accumulated depreciation—buildings $61,350,000 Accumulated depreciation—equipment 54,700,000 Buildings 97,200,000 Equipment 150,300,000 Land 20,150,000 The company uses straight-line depreciation for buildings and equipment, its year-end is December 31, and it makes adjusting entries annually. The buildings are estimated to have a 40-year useful life and no salvage value; the equipment is estimated to have a 10-year useful life and no salvage value. During 2022, the following selected transactions...
At January 1, 2022, Wildhorse Co. reported the following property, plant, and equipment accounts: Accumulated depreciation—buildings...
At January 1, 2022, Wildhorse Co. reported the following property, plant, and equipment accounts: Accumulated depreciation—buildings $61,350,000 Accumulated depreciation—equipment 54,700,000 Buildings 97,200,000 Equipment 150,300,000 Land 20,150,000 The company uses straight-line depreciation for buildings and equipment, its year-end is December 31, and it makes adjusting entries annually. The buildings are estimated to have a 40-year useful life and no salvage value; the equipment is estimated to have a 10-year useful life and no salvage value. During 2022, the following selected transactions...
Bebtley Co. purchased equipment on January 1, 2017, at a cost of $45,000. Depreciation for 2017...
Bebtley Co. purchased equipment on January 1, 2017, at a cost of $45,000. Depreciation for 2017 and 2018 was based on an estimated eight-year life and $3,000 estimated residual value. The company uses the straight-line method of depreciation and records any partial-year depreciation based on the number of months the asset is in service. In 2019, Bentley Co. revised its depreciation estimate and now believes the equipment will have a total service life of six years & a residual value...
Eckland Manufacturing Co. purchased equipment on January 1, 2009, at a cost of $90,000. Depreciation for...
Eckland Manufacturing Co. purchased equipment on January 1, 2009, at a cost of $90,000. Depreciation for 2009 and 2010 was based on an estimated ten-year life, $2,000 estimated residual value and Double decline balance depreciation method. On January 1, 2011, Eckland revised its estimate and now believes the equipment will have a remaining service life of eight years, $2,500 estimated residual value and sum-of-years ‘ digits (SYD) depreciation method . On Dec 31 2011, Eckland reasonably estimated future cash flow...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT