Prepare ledger accounts, income statement, and balance sheet 

The following events occurred during the first half of the year. Book the entries necessary for the corresponding transactions that have occurred.

 January 1: Purchased a fleet of vehicles for $350,000 via a loan from the bank. The trucks have a useful life of six years.

 The loan is for six years with an interest rate of 4.3%.

 The company already owned $200,000 of vehicles prior to this purchase with an accumulated depreciation of $80,000. 

February 6: It is determined that the intangible recorded for a patent is impaired by $50,000. 

The patent owned for two years was estimated to be worth $120,000 and has a life of 10 years. Book the journal entry for the impairment. 

March 25: Purchased 10-year maturity bonds as an investment for $45,000. 

April 5: New construction equipment was purchased for the project at the golf course for $120,000.

 The forklifts have a useful life of seven years. The company already owned $50,000 of construction equipment prior to this purchase with an accumulated depreciation of $22,000. 

May 1: A new long-term lease is entered into for a much larger corporate office which will house the company and its future acquired company. The net present value of the future lease payments is $510,800. The lease is for six years. 

June 14: A forklift is disposed of that had a book value of $7,500 and accumulated depreciation of $5,200 .

 June 30: Book the depreciation for the first half of the year on the vehicles you purchased January 1. 

June 30: Book the depreciation for the first half of the year on the construction equipment you purchased April 5.

 June 30: Book the interest for the first half of the year on the fleet of vehicles you purchased January 1.

 June 30: Book the amortization for the first half of the year on the right-of-use leased asset from May 1.

Answer rating: 100% (QA)

Ledger Accounts 1 Fleet of Vehicles Purchased on January 1 Date Account Debit Credit Jan 1 Vehicles ... View the full answer