Lifestyle Lighting Ltd. reported the following on its balance sheet at December 31, 2013: Capital assets, at

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Lifestyle Lighting Ltd. reported the following on its balance sheet at December 31, 2013:

Capital assets, at cost:

Land ..................................................................................................... $ 150,000

Buildings .............................................................................................. 400,000

Less Accumulated depreciation ............................................................. (87,500)

Equipment ........................................................................................... 600,000

Less Accumulated depreciation ............................................................. (260,000)

In early July 2014, Lifestyle Lighting Ltd. expanded operations and purchased additional equipment at a cost of $100,000. The company depreciates buildings by the straight-line method over 20 years with residual value of $50,000. Due to obsolescence, the equipment has a useful life of only 10 years and is being depreciated by the double-diminishing-balance method with zero residual value.

Requirements

1. Journalize Lifestyle Lighting Ltd.'s capital equipment purchase and depreciation transactions for 2014.

2. Report capital assets on the December 31, 2014, balance sheet.

Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...
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Financial Accounting

ISBN: 978-0133472264

5th Canadian edition

Authors: Charles Horngren, William Thomas, Walter Harrison, Greg Berberich, Catherine Seguin

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