Swann Company sold a delivery truck on April 1, 2019. Swann had acquired the truck on January 1, 2015, for $39,500. At acquisition, Swann had estimated that the truck would have an estimated life of 5 years and a residual value of $3,000. Swann uses the straight-line method of depreciation. At December 31, 2018, the truck had a book value of $10,300. Required: 1. Prepare any necessary journal entries to record the sale of the truck, assuming it sold for: a. $10,125 b. $6,725 2. How should the gain or loss on disposal be reported on the income statement? 3. Assume that Swann uses IFRS and sold the truck for $10,125. In addition, Swann had previously recorded a revaluation surplus related to this machine of $4,000. What journal entries are required to record the sale

Swann Company sold a delivery truck on April 1, 2019. Swann had acquired the truck on January 1, 2015, for $39,500. At acquisition, Swann had estimated that the truck would have an estimated life of 5 years and a residual value of $3,000. Swann uses the straight-line method of depreciation. At December 31, 2018, the truck had a book value of $10,300. Required: 1. Prepare any necessary journal entries to record the sale of the truck, assuming it sold for: a. $10,125 b. $6,725 2. How should the gain or loss on disposal be reported on the income statement? 3. Assume that Swann uses IFRS and sold the truck for $10,125. In addition, Swann had previously recorded a revaluation surplus related to this machine of $4,000. What journal entries are required to record the sale

Name: Swann Company sold a delivery truck on April 1, 2019. Swann had acquir
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Description: Swann Company sold a delivery truck on April 1, 2019. Swann had acquired the truck on January 1, 2015, for $39,500. At acquisition, Swann had estimated that the truck would have an estimated life of 5 years and a residual value of $3,000. Swann uses

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter11: Depreciation, Depletion, Impairment, And Disposal

Section: Chapter Questions

Problem 7E: Loban Company purchased four cars for 9,000 each and expects that they will be sold in 3 years for...

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Kam Company purchased a machine on January 2, 2019, for 20,000. The machine had an expected life of 8 years and a residual value of 300. The double-declining-balance method of depreciation is used. Required: 1. Compute the depreciation expense for each year of the assets life and book value at the end of each year. 2. Assuming that the company has a policy of always changing to the straight-line method at the midpoint of the assets life, compute the depreciation expense for each year of the assets life. 3. Assuming that the company always changes to the straight-line method at the beginning of the year when the annual straight-line amount exceeds the double-declining-balance amount, compute the depreciation expense for each year of the assets life.
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Swann Company sold a delivery truck on April 1, 2019. Swann had acquired the truck on January 1, 2015, for $42,000. At acquisition, Swann had estimated that the truck would have an estimated life of 5 years and a residual value of $5,000. Swann uses the straight-line method of depreciation. At December 31, 2018, the truck had a book value of $12,400. Required: 1. Prepare any necessary journal entries to record the sale of the truck, assuming it sold for: a. $12,000 b. $9,000 2. How should the gain or loss on disposal be reported on the income statement? 3. Assume that Swann uses IFRS and sold the truck for $12,000. In addition, Swann had previously recorded a revaluation surplus related to this machine of $4,000. What journal entries are required to record the sale? A. Depreciation expense of the delivery truck for 2019 B. The sale of the truck, assuming it sold for $12,000 C. Other adjustments related to removing the delivery truck from the books
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