Homework Answers
In case of assets acquisition the cost of assets is to be considered the cost incurred till the asset is put to use.
Since the company has purchased the asset and paid sales tax and Installation/delivery charge it will be added to the cost of Assets i.e till the asset is put and ready for use.
Hence the cost of Acquisition of Warehouse Equipment is:
| Purchase Cost | $75,000 | |
| Add: | Sales Tax | $5,000 |
| Add: | Installation/Delivery Charges | $20,000 |
| Total Cost of Acquisition of Assets | $1,00,000 |
The assets is being used and hence depreciation is charged.
Further the asset is sold on 7/31/2020 at the value of $65000. The profit and loss on sale of Asset is shown as follows in the tabulated form:
| Date | Particulars | Amount | |
| 01-01-18 | Cost of Acquisition | $1,00,000 | |
| Less: | 7/31/20 | Depreciation | ($20,000) |
| Less: | 7/31/20 | Deduction u/s 179 | ($5,000) |
| 7/31/20 | Value as on date | $75,000 | |
| Less: | 7/31/20 | Sale value of Equipment | $65,000 |
| 7/31/20 | Loss on sale of Equipment | ($10,000) | |
So, the option C is correct the Loss on sale of Assets is ( $10000).
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12/31/Year 4
Net
Balances
Balances
Change
Dr.(Cr.)
Dr.(Cr.)
Dr.(Cr.)
Cash
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610,000
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(10,000)
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the following information:
The following information is available for 2017.
Equipment (cost $10,000 and accumulated depreciation $4,000)
was sold for $7,000. All other changes in Property, Plant and
Equipment accounts relate to purchases and depreciation expense,
respectively.
Intangible Assets costing $10,000 were purchased during
2017.
There were $25,000 in payments on the Bonds Payable during
2017
12/31/2016 Closing Trial Balance 55,000 70,000 (4,000) 80,000 9,000 - Cash Accounts Receivable...
Scroll down to complete all parts of this
task.
The following condensed trial balance of Gator Co., a publicly
held company, has been adjusted except for income tax expense.
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Net
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$ 413,000
$ 757,000
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670,000
610,000
60,000
Property, plant, and equipment
1,070,000
995,000
75,000
Accumulated depreciation
(345,000)
(280,000)
(65,000)
Available-for-sale securities
70,000
60,000
10,000
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