On January 1, 2011, Greg's Grocery purchased a truck for $41,000 that has an estimated useful life of five years and a $1,000 residual value. Greg uses the straight-line depreciation method. Record the journal entries under each of the following disposal scenarios that may occur on March 31, 2013: 

a. The truck is in an accident and totaled. It is scrapped for $0. There are no insurance proceeds. 

b. Greg sells the truck for $10,000 cash. 

c. Gerg sells the truck and receives $20,000 plus a piece of equipment worth $5,000. 

d. Greg trades-in the truck for a new truck. The suggested retail price of the new truck is $32,000. 

e. Greg trades-in the truck plus pays $3,000 for a new truck. The suggested retail price of the new truck is $32,000.

Answer rating: 100% (QA)

Required Answers Cost of assets 41000 Less Salvage 1000 Depreciable cost 40000 Divide Life 5 Annual ... View the full answer