Problem-
At December 31, 2014, Navaro Corporation reported the following plant assets.
|
Land
|
|
$3,894,000
|
|
Buildings
|
$34,010,000
|
|
|
Less: Accumulated depreciation-buildings
|
15,478,650
|
18,531,350
|
|
Equipment
|
51,920,000
|
|
|
Less: Accumulated depreciation-equipment
|
6,490,000
|
45,430,000
|
|
Total plant assets
|
|
$67,855,350
|
During 2015, the following selected cash transactions occurred.
Apr. 1 Purchased land for $2,855,600.
May 1 Sold equipment that cost $778,800 when purchased on January 1, 2008. The equipment was sold for $220,660.
June 1 Sold land for $2,076,800. The land cost $1,298,000.
July 1 Purchased equipment for $1,427,800.
Dec. 31 Retired equipment that cost $908,600 when purchased on December 31, 2005. No salvage value was received.
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.