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    Disposal of fixed assets-journal entries

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    P10-5A

    At December 31, 2008, Jimenez Company reported the following as plant assets.
    Land $4,000,000
    Buildings $28,500,000
    Less: Accumulated depreciation-buildings 12,100,000 16,400,000
    Equipment 48,000,000
    Less: Accumulated depreciation-equipment 5,000,000 43,000,000
    Total plant assets $63,400,000
    During 2009, the following selected cash transactions occurred.
    April 1 Purchased land for $2,130,000.
    May 1 Sold equipment that cost $780,000 when purchased on January 1, 2005. The equipment was sold for $450,000.
    June 1 Sold land purchased on June 1, 1999, for $1,500,000. The land cost $400,000.
    July 1 Purchased equipment for $2,000,000.
    Dec. 31 Retired equipment that cost $500,000 when purchased on December 31, 1999. No salvage value was received.

    Journalize the above transactions. The company uses straight-line depreciation for buildings and equipment. The buildings are estimated to have a 50-year 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. (For multiple debit/credit entries, list amounts from largest to smallest eg 10, 5, 3, 2.)
    Date Account / Description Debit Credit
    Apr. 1
    $

    $

    May 1
    $

    $

    (To record depreciation.)
    May 1
    $

    $

    $

    $

    (To record sale of equipment.)
    June 1
    $

    $

    $

    July 1
    $

    $

    Dec. 31
    $

    $

    Dec. 31
    $

    $

    (To record retirement of equipment.)

    Record adjusting entries for depreciation for 2009.
    Date Account / Description Debit Credit
    Dec. 31
    $

    $

    (To record building depreciation.)
    Dec. 31
    $

    $

    (To record equipment depreciation.)

    Complete the plant assets section of Jimenez's balance sheet at December 31, 2009. (Enter all amounts as positive amounts and subtract where necessary.)
    JIMENEZ COMPANY
    Balance Sheet (Partial)
    December 31, 2009
    Plant Assets

    $

    $

    Less:

    Less:

    Total plant assets $

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    Solution Summary

    Journal entries on sale fo fixed assets
    Journal entry for sale of asset in mid year
    entry for slae of asset at a gain
    entry for sale of asset at a loss

    $2.19

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