There are list of assets of Multiverse Corporation: Estimated Date of Cost per Estimated salvage Depreciation purchase (acquisition) Assets Quantity unit ($) useful life value per unit ($) Method Land July, 1 2011 1 2,000,000 October, 1 Building 4 1,700,000 20 years 100,000 Straight Line 2012 March, 1 Units of Vehicle 1 240,000 100,000 km 40,000 2018 activity October, 1 Declining Machine 4 120,000 4 years 8,000 2018 Balance Declining Equipment June, 1 2019 4 100,000 4 years Balance Information about all assets in the company during 2021 as follow: A building was sold for $ 1,100,000 April, 1 April, 30 Three units of machine were sold at a price of @$ 30,000 June, 1 Two units of equipment were retired because they were not functioning properly September, 30 A vehicle was exchanged for a new vehicle. At the time of exchange, an old vehicle is valued at $ 64,000. The new vehicle has an estimated residual value of $ 10,000 and an estimated useful life of 200,000 km. New vehicle are depreciated using the unit of activity method. Until 2020, the old vehicle had been depreciated by 80,000 km. Early 2021 to September 30, 2021 the old vehicle have been depreciated by 5,000 km. Required: Journalize all transactions above and give your explanation for each transaction!
There are list of assets of Multiverse Corporation: Estimated Date of Cost per Estimated salvage Depreciation purchase (acquisition) Assets Quantity unit ($) useful life value per unit ($) Method Land July, 1 2011 1 2,000,000 October, 1 Building 4 1,700,000 20 years 100,000 Straight Line 2012 March, 1 Units of Vehicle 1 240,000 100,000 km 40,000 2018 activity October, 1 Declining Machine 4 120,000 4 years 8,000 2018 Balance Declining Equipment June, 1 2019 4 100,000 4 years Balance Information about all assets in the company during 2021 as follow: A building was sold for $ 1,100,000 April, 1 April, 30 Three units of machine were sold at a price of @$ 30,000 June, 1 Two units of equipment were retired because they were not functioning properly September, 30 A vehicle was exchanged for a new vehicle. At the time of exchange, an old vehicle is valued at $ 64,000. The new vehicle has an estimated residual value of $ 10,000 and an estimated useful life of 200,000 km. New vehicle are depreciated using the unit of activity method. Until 2020, the old vehicle had been depreciated by 80,000 km. Early 2021 to September 30, 2021 the old vehicle have been depreciated by 5,000 km. Required: Journalize all transactions above and give your explanation for each transaction!
Chapter14: Property Transactions: Capital Gains And Losses, § 1231, And Recapture Provisions
Section: Chapter Questions
Problem 74P
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Transcribed Image Text:There are list of assets of Multiverse Corporation:
Estimated
Date of
Cost per
Estimated
salvage
Depreciation
purchase
(acquisition)
Assets
Quantity
unit ($)
useful life
value per
Method
unit ($)
Land
July, 1 2011
1
2,000,000
October, 1
Building
4
1,700,000
20 years
100,000
Straight Line
2012
March, 1
Units of
Vehicle
1
240,000
100,000 km
40,000
2018
activity
October, 1
Declining
Machine
4
120,000
4 years
8,000
2018
Balance
Declining
Equipment
June, 1 2019
4
100,000
4 years
Balance
Information about all assets in the company during 2021 as follow:
A building was sold for $ 1,100,000
Three units of machine were sold at a price of @$ 30,000
April, 1
April, 30
June, 1
Two units of equipment were retired because they were not functioning properly
September, 30 A vehicle was exchanged for a new vehicle. At the time of exchange, an old vehicle is
valued at $ 64,000. The new vehicle has an estimated residual value of $ 10,000 and
an estimated useful life of 200,000 km.
New vehicle are depreciated using the unit of activity method.
Until 2020, the old vehicle had been depreciated by 80,000 km. Early 2021 to
September 30, 2021 the old vehicle have been depreciated by 5,000 km.
Required:
Journalize all transactions above and give your explanation for each transaction!
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