In 2021, Ellie's cupcakes upgraded her delivery vehicle by engaging in the following sale/purchase transactions: Jan...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
In 2021, Ellie's cupcakes upgraded her delivery vehicle by engaging in the following sale/purchase transactions: Jan 3, 2021 - Sale of Delivery Van: Proceeds received were $15,000 cash. The December 31, 2020 financial statements indicated the original cost of the van was $65,000 and had accumulated depreciation of $57,000. Jan 5, 2021 - Purchase of Delivery Van: Ellie put down $15,000 cash and signed a 1-year, $60,000, 6% note payable for the balance. Ellie also splurged and paid an additional $2,000 cash to have her company logo painted on the side of the van. Ellie expects to keep the vehicle for 5 years and anticipates that it will be worth $5,000 at the end of the 5 years. Company policy requires that vehicles are retained for a maximum of 100,000 kms, which Ellie expects will take the 5 years to reach, with the following annual breakdown: 2021 - 25,000 km 2022 - 22,000 km 2023 – 20,000 km 2024 - 18,000 km 2025 - 15,000 km On September 30, 2024, after having driven the delivery vehicle for 13,500 km over the course of the year, Ellie decided to close her business and move to Australia. Ellie sold her vehicle for $15,000. Required: a) Record the January 2021 transactions in Ellie's journal with appropriate descriptions for each entry. b) Record the adjusting journal entries required for depreciation using the units of production method for Ellie's ownership period (2021, 2022, 2023, and 2024) with appropriate descriptions for each entry. c) Record the September 2024 transaction in Ellie's journal with appropriate descriptions for each entry. In 2021, Ellie's cupcakes upgraded her delivery vehicle by engaging in the following sale/purchase transactions: Jan 3, 2021 - Sale of Delivery Van: Proceeds received were $15,000 cash. The December 31, 2020 financial statements indicated the original cost of the van was $65,000 and had accumulated depreciation of $57,000. Jan 5, 2021 - Purchase of Delivery Van: Ellie put down $15,000 cash and signed a 1-year, $60,000, 6% note payable for the balance. Ellie also splurged and paid an additional $2,000 cash to have her company logo painted on the side of the van. Ellie expects to keep the vehicle for 5 years and anticipates that it will be worth $5,000 at the end of the 5 years. Company policy requires that vehicles are retained for a maximum of 100,000 kms, which Ellie expects will take the 5 years to reach, with the following annual breakdown: 2021 - 25,000 km 2022 - 22,000 km 2023 – 20,000 km 2024 - 18,000 km 2025 - 15,000 km On September 30, 2024, after having driven the delivery vehicle for 13,500 km over the course of the year, Ellie decided to close her business and move to Australia. Ellie sold her vehicle for $15,000. Required: a) Record the January 2021 transactions in Ellie's journal with appropriate descriptions for each entry. b) Record the adjusting journal entries required for depreciation using the units of production method for Ellie's ownership period (2021, 2022, 2023, and 2024) with appropriate descriptions for each entry. c) Record the September 2024 transaction in Ellie's journal with appropriate descriptions for each entry.
Expert Answer:
Answer rating: 100% (QA)
The van was sold for 1500000 The cost of a vehicle is 65000 Depreciation in Kin... View the full answer
Related Book For
Accounting
ISBN: 978-0176509743
Volume 1, 2nd canadian Edition
Authors: Carl warren, James Reeve, Jonathen Duchac, Sheila Elworthy,
Posted Date:
Students also viewed these accounting questions
-
The Sampsons think that it will be very difficult for them to pay the full amount of their taxes at this time. Consequently, they are thinking about underreporting their actual income on their tax...
-
Acadia Logistics anticipates that it will need more distribution center space to accommodate what it believes will be a significant increase in demand for its final-mile services. Acadia could either...
-
Alpha Inc., has just announced that it will be acquiring Bravo Inc., for $25/share in an all-cash deal. On the day of the announcement, Alphas stock price declined from $42/share to $40/share, while...
-
Your client, Mr. Brakes Inc., owns and operates an auto-motive repair shop in Cooperstown, New York. Mr. Brakes specializes in replacing and repairing brakes on cars, sport utility vehicles, and...
-
Mar. 2 Sold merchandise inventory on account to B. Kamp, issuing invoice no. 501 for $1,100 (cost, $1,090). 6 Issued credit memo to B. Kamp for $1,100 for merchandise returned to the business by the...
-
For each of the following studies, identify the source(s) of sampling bias and describe (i) how it might affect the study conclusions and (ii) how you might alter the sampling method to avoid the...
-
What are the main factors considered when writing a report?
-
Activity-based costing flexible-budget variances for finance-function activities. FastGrocery.com an online company that delivers groceries to its customers has the following information for its...
-
Q1) Use the data on the next page and answer the following: How many factors being experimented? How many corner point runs exist part of the experiment? How many center points exist part of the...
-
Consider the novel device for oxidative treatment of wastewater shown in the figure (right column). In this device, O 3 will serve as the oxidant source, which must be carefully dosed into the...
-
Using data from 50 workers, a researcher estimates Wage=Bo + BEducation + BExperience + B3Age + &, where Wage is the hourly wage rate and Education, Experience, and Age are the years of higher...
-
How can this brand (Adidas) improve its social responsibility campaign and its communication? Design a new social responsibility campaign for this brand (Adidas). Please explain your rationale for...
-
Rainbow City is authorized to issue $10,000,000 4% regular serial bonds in 20x0 for the construction of a new police station. The bonds mature in equal annual amounts beginning on January 1, 20X1,...
-
Karim Corp. requires a minimum $9,600 cash balance. Loans taken to meet this requirement cost 1% interest per month (paid monthly). Any excess cash is used to repay loans at month-end. The cash...
-
What is objectivity in terms of the internal audit process? What factors does an external auditor consider when evaluating the objectivity of a client company's internal audit processes? Add...
-
Assume you are working with a family/client from a culture different than yours; list the ways you could assess your 1) level of understanding and 2) potential bias. Conceptual Framework and...
-
Enterprise Mobility Management / / EMM / / Deployment Best Practices 1 1 - Planning 2 2 - Design 3 3 - Deployment 4 4 - Rollout
-
Cobb Manufacturing Company uses a process cost system and average costing. The following production data is for the month of June 2011. Production Costs Work in process, beginning of the month:...
-
The payroll register for Cupcake Co. for the week ended April 10, 2015, is presented in the working papers. Instructions 1. Journalize the entry to record the payroll for the week. 2. Journalize the...
-
On October 11, 2014, Usher Company purchased a building for $2,250,000. The building, land, and land improvements were valued at $1,440,000, $840,000, and $120,000 respectively. Prepare the journal...
-
The beginning inventory for Martin Co. and data on purchases and sales for a two-month period are shown in Problem 6-2B. Round the average cost to two decimal places. In problem 6-2B The beginning...
-
True or False: The most commonly used measure of inflation is the relative change in the Consumer Price Index.
-
Mike's Veneer Shop owns a vacuum press that requires annual maintenance. Mike has a contract to cover the maintenance expenses for the next 5 years. The contract calls for an annual payment of \(\$...
-
What is the relationship between inflation and deflation? Give an example of deflation experienced in your everyday life.
Study smarter with the SolutionInn App