Chapter+9+Fall+2011-1

Chapter+9+Fall+2011-1 - You purchase a piece of equipment...

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Chapter 9 ________________________________ ABC Corporation purchased an office building on a beautiful lot for $3,650,000 with $100,000 cash and the rest on a note. The appraisal indicates that the market value of the land is $1,000,000 and the building is $3,000,000. Record the entry for the purchase. (6 points) Ordinary repairs and maintenance always: (definition) a. are part of the asset cost of equipment and facilities b. are recorded as expenses c. are recorded as liabilities d. improve the asset beyond the current accounting period When a company records depreciation it debits a. liabilities and credits expenses b. expenses and credits cash c. expenses and credits a contra-asset account d. long-lived assets and credits expenses
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Unformatted text preview: You purchase a piece of equipment for a cash price of $10,000 on January 1, 2008, delivery costs were $1,000, taxes were $500, insurance during shipping was $250, the logo cost $250, annual insurance on the machine is $450, installation and testing cost $2,000. The company paid cash record the entry for the purchase of the machine. For the machine above, use straight-line depreciation, useful life 5 years, salvage value $4000. What is the adjusting entry on December 31, 2008? You decide to sell the machine on June 30, 2010 for $10,000 what is the gain or loss on sale? You decide to sell the machine on June 30, 2010 for $4,000 what is the gain or loss on sale?...
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This note was uploaded on 01/18/2012 for the course ACCT 207 taught by Professor Hudchinson during the Fall '08 term at University of Delaware.

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Chapter+9+Fall+2011-1 - You purchase a piece of equipment...

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