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P9-2A At December 31, 2012, Rivera Corporation reported the following plant assets.


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P9-2A At December 31, 2012, Rivera Corporation reported the following plant assets.

Land $ 3,000,000
Buildings $26,500,000
Less: Accumulated depreciation—buildings 11,925,000 14,575,000
Equipment 40,000,000
Less: Accumulated depreciation—equipment 5,000,000 35,000,000
Total plant assets $52,575,000
During 2013, the following selected cash transactions occurred.

Apr. 1 Purchased land for $2,200,000.

May 1 Sold equipment that cost $600,000 when purchased on January 1, 2006.
The equipment was sold for $170,000.

June 1 Sold land for $1,600,000. The land cost $1,000,000.

July 1 Purchased equipment for $1,100,000.

Dec. 31 Retired equipment that cost $700,000 when purchased on December
31, 2003. No salvage value was received.

Instructions
(a) Journalize the transactions. (Hint: You may wish to set up T accounts, post beginning
balances, and then post 2013 transactions.) Rivera uses straight-line depreciation
for buildings and equipment. 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. Update depreciation on assets disposed of at the time
of sale or retirement.

(b) Record adjusting entries for depreciation for 2013.

(c) Prepare the plant assets section of Rivera’s balance sheet at December 31, 2013

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