Question

Ocean Fishers Ltd had a 22-foot fishing boat with an inboard motor that was purchased on April 9, 2009, for $114,000. The PPE Sub ledger shows the following information regarding the boat: Fishing Boat - 22 Foot With Inboard Motor: Date of Component Deprec. Cost Est. Purchase Method Fibreglass body Apr. 9/09 SL $ 42,000 $9,000 15 yr Motor Apr. 9/09 SL 72,000 10 yr Residual Est.Life $ 114,000 On June 27, 2017, $78,000 cash was paid for a new motor to replace the old one, which was scrapped. The new motor had an estimated useful life of 12 years and a residual value of $3,000. Early in 2017, it was determined that the useful life of the boat's fibreglass body should be adjusted to a total of 20 years with no change in the residual value. Required: 1. Record the appropriate entries regarding the a. Purchase of the replacement motor on June 27, 2017. (If no entry is required for a transaction, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet Record depreciation in 2017 regarding motor being replaced. Note: Enter debits before credits. Date General Journal Debit Credit June 27, 2017 Record entry Clear entry View general journal

Answer 1

Date	Particulars				Debit	Credit
09-04-2017	Depreciation expense Dr.				57600
		To Accumulated Depreciation				57600
	(To record depreciation expense of motor)
27-06-2017	Depreciation expense Dr.				1560
		To Accumulated Depreciation				1560
	(To record depreciation expense of motor)
27-06-2017	Accumulated Depreciation Dr.				59160
		To Fishing Boat a/c				59160
	(To recognize actual value of asset after depreciation)
27-06-2017	Loss on sale of equipment A/c Dr.				12840
		To Fishing Boat A/c				12840
	(To record loss on sale of motor)
27-06-2017	Fishing Boat A/c Dr.				78000
		To Cash				78000
	(To record purchase of new motor)

Depreciation of Motor
Date	Beginning	Depreciation	Endng
09-04-2010	72000	7200	64800
09-04-2011	64800	7200	57600
09-04-2012	57600	7200	50400
09-04-2013	50400	7200	43200
09-04-2014	43200	7200	36000
09-04-2015	36000	7200	28800
09-04-2016	28800	7200	21600
09-04-2017	21600	7200	14400
27-06-2017	14400	1560	12840
		59160