Problem 9-2A
At December 31, 2014, Navaro Corporation reported the following plant assets.
Land$ 5,628,000
Buildings$29,210,000
Less: Accumulated depreciation—buildings22,371,300
6,838,700
Equipment75,040,000
Less: Accumulated depreciation—equipment9,380,000
65,660,000
Total plant assets$78,126,700
During 2015, the following selected cash transactions occurred.
Apr. 1Purchased land for $4,127,200.May 1Sold equipment that cost $1,125,600 when purchased on January 1, 2008. The equipment was sold for $318,920.June 1Sold land for $3,001,600. The land cost $1,876,000.July 1Purchased equipment for $2,063,600.Dec. 31Retired equipment that cost $1,313,200 when purchased on December 31, 2005. No salvage value was received.
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Journalize the transactions. Navaro uses straight-line depreciation for buildings and equipment. The buildings are estimated to have a 40-year useful 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.(Record entries in the order displayed in the problem statement. Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Date
Account Titles and Explanation
Debit
Credit
April 1May 1June 1July 1Dec. 31
April 1May 1June 1July 1Dec. 31
(To record depreciation on equipment sold)
April 1May 1June 1July 1Dec. 31
April 1May 1June 1July 1Dec. 31
April 1May 1June 1July 1Dec. 31
(To record depreciation on equipment retired)
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Record adjusting entries for depreciation for 2015.(Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Date.
Account Titles and Explanation
Debit
Credit
Dec. 31
(To record depreciation on buildings.)
31
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Prepare the plant assets section of Navaro’s balance sheet at December 31, 2015. (Hint:You may wish to set up T accounts, post beginning balances, and then post 2015 transactions.)(List Plant Assets in order of Land, Building and Equipment.)
NAVARO CORPORATION
Partial Balance Sheet
December 31, 2015
Current AssetsCurrent LiabilitiesExpensesIntangible AssetsLong-term InvestmentsLong-term LiabilitiesNet Income / (Loss)Plant AssetsRevenuesStockholders’ EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal ExpensesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Stockholders’ EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Plant AssetTotal RevenuesTotal Stockholders’ Equity
$
$
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Current Assets Current Liabilities Expenses Intangible Assets Long-term Investments Long-term Liabilities Net Income / (Loss) Plant Assets Revenues Stockholders’ Equity Total Assets Total Current Assets Total Current Liabilities Total Expenses Total Intangible Assets Total Liabilities Total Liabilities and Stockholders’ Equity Total Long-term Investments Total Long-term Liabilities Total Plant Asset Total Revenues Total Stockholders’ Equity
