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Tuesday, 30 October 2012

At December 31, 2011, Jimenez Company reported the following as plant assets.

Question 6

 

At December 31, 2011, 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 2012, 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, 2008. The equipment was sold for $450,000.

June 1

Sold land purchased on June 1, 2002, 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, 2002. 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

 

 

 

     

 

 

(To record depreciation.)

 

 

Dec. 31

 

 

 

      

 

 

(To record retirement of equipment.)

 

 

 

 

 

 

 

 

 

 
 
   

 

 

Record adjusting entries for depreciation for 2012.

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, 2012. (List in the same order as the partial balance sheet presented in the problem. Enter all amounts as positive amounts and subtract where necessary.)

JIMENEZ COMPANY

Balance Sheet (Partial)

December 31, 2012

Plant Assets

 

 

   

 

$

   

$

 

    Less:

   

 

    Less:

        Total plant assets

 

$

 

 

 

 

 

 



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