At December 31, 2014, Navaro Corporation reported the following plant assets.
|
Land
|
|
$ 4,473,000
|
|
Buildings
|
$30,940,000
|
|
|
Less: Accumulated depreciation-buildings
|
17,780,175
|
13,159,825
|
|
Equipment
|
59,640,000
|
|
|
Less: Accumulated depreciation-equipment
|
7,455,000
|
52,185,000
|
|
Total plant assets
|
|
$69,817,825
|
During 2015, the following selected cash transactions occurred.
|
Apr. 1
|
Purchased land for $3,280,200.
|
|
May 1
|
Sold equipment that cost $894,600 when purchased on January 1, 2008. The equipment was sold for $253,470.
|
|
June 1
|
Sold land for $2,385,600. The land cost $1,491,000.
|
|
July 1
|
Purchased equipment for $1,640,100.
|
|
Dec. 31
|
Retired equipment that cost $1,043,700 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.
Record adjusting entries for depreciation for 2015.
|
Date.
|
Account Titles and Explanation
|
Debit
|
Credit
|
|
Dec. 31
|
|
|
|
|
|
|
|
|
|
|
(To record depreciation on buildings.)
|
|
|
|
31
|
|
|
|
|
|
|
|
|
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.)