Journalize: Entries for a Specific Company
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Presented below are selected transactions at Thomas Company for 2005.
Jan. 1: Retired a piece of machinery that was purchased on January 1, 1995. The machine cost $62,000 on that date. It had a useful life of 10 years with no salvage value.
June 30: Sold a computer that was purchased on January 1, 2002.The computer cost $35,000. It had a useful life of 5 years with no salvage value. The computer was sold for $12,000.
Dec. 31: Discarded a delivery truck that was purchased on January 1, 2001. The truck cost $33,000. It was depreciated based on a 6-year useful life with a $3,000 salvage value.
Instructions:
Journalize all entries required on the above dates, including entries to update depreciation, where applicable, on assets disposed of. Thomas Company uses straight-line depreciation. (Assume depreciation is up to date as of December 31, 2004.)
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Solution Summary
This solution is comprised of a response providing the entries together with explanations about the disposition of assets. An Excel file is attached which contains the solution in proper format.
Solution Preview
Please see attached file for better formatting of the solution.
Thompson Company
2005 Debit Credit
1-Jan Retired Assets $6,200
Accumulated Depreciation $55,800
Equipment $62,000
To record the retirement of an asset used in operations. Asset was purchased 1-1-95 with a 10 ...
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