Question

8B-1. RASPBERRY Corporation's chart of accounts includes the following categories: Land, Equipment, Patents. Copyrights, and Coal Reserves. RASPBERRY completed the following transactions during the year: Jan 2 Feb 3 Purchased Equipment for $140,000 cash; RASPBERRY also had to pay 10% tax and a $6,000 license fee. Purchased a coal field with 40,000 tons of coal reserves for $2,000,000 cash. Purchased a copyright from another company for $120.000 cash. Purchased a patent and a piece of land for a lump sum payment of $60,000. The land was appraised at $80,000 while the patent appraised at $20,000. March 4 May 5

Answer 1

                                       JOURNAL ENTRIES

DATE	PARTICULARS	AMOUNT	AMOUNT
JAN 2	EQUIPMENT A/C        DR	160000
	TO CASH		140000
	TO 10% TAX		14000
	TO LICENCE FEE		6000
	(EQUIPMENT PURCHASED)
FEB 3	COAL FIELD A/C        DR	2000000
	TO CASH		2000000
	(COAL FIELD PURCHASED)
MAR 4	COPYRIGHT A/C        DR	120000
	TO CASH		120000
	(COPYRIGHT PURCHASED
MAY 5	PATENT&LAND A/C     DR	60000
	TO CASH		60000
	(PATENT &LAND PURCHASED)
JULY 1	CASH A/C             DR	60000
	TO BUILDING
	(SALE OF BUILDING)
OCT 2	OLD EQUIPMENT A/C   DR	130000
	TO CASH		130000
	(PURCHASE OF OLD EQUIPMENT)

CALCULATION OF BUILDING (JULY 1)

   ORIGINAL COST               800000

   LESS DEPRECIATION       200000   (400000 /2)

       TOTAL                 600000