The following transactions and adjusting entries were completed by Legacy Furniture Co. during a three-year period. All are related to theuse of delivery equipment. The double-declining-balance method of depreciation is used. Journalize the transactions and the adjusting entries. Refer to the Chart of Accounts for exact wording of account titles. Transcribed Image Text: In Journal
PAGE 1
TH
rel
JOURNAL
ACCOUNTING EQUATION
DATE
DESCRIPTION
POST. REF.
DEBIT
CREDIT
ASSETS
LIABILITIES
EQUITY
1
3
Adjusting Entries
Journalize the Year 2 transactions and adjusting entries on Page 2.
PAGE 2
JOURNAL
ACCOUNTING EQUATION
DATE
DESCRIPTION
POST. REF.
DEBIT
CREDIT
ASSETS
LIABILITIES
EQUITY
2
4
5
9 Transcribed Image Text: Instructions
Chart of Accounts
ASSETS
REVENUE
The following transactions and adjusting entries were completed by Legacy Furniture Co. during a three-year period. All are
related to the use of delivery equipment. The double-declining-balance method of depreciation is used.
110 Cash
410 Sales
111 Petty Cash
610 Interest Revenue
Year 1
112 Accounts Receivable
620 Gain on Sale of Delivery Truck
Jan. 4.
Purchased a used delivery truck for $27,200, paying cash.
114 Interest Receivable
621 Gain on Sale of Equipment
Nov. 2.
Paid garage S630 for miscellaneous repairs to the truck.
115 Notes Receivable
Dec.
Recorded depreciation on the truck for the year. The estimated useful life of the truck is four years,
116 Merchandise Inventory
EXPENSES
with a residual value of $5,005 for the truck.
31.
117 Supplies
510 Cost of Merchandise Sold
Year 2
119 Prepaid Insurance
520 Salaries Expense
Jan. 6
Purchased a new truck for S49,250, paying cash.
120 Land
521 Advertising Expense
Apг. 1.
Sold the used truck for $14,670. (Record depreciation to date in Year 2 for the truck.)
123 Delivery Truck
522 Depreciation Expense-Delivery Truck
June
Paid garage $450 for miscellaneous repairs to the truck.
124 Accumulated Depreciation-Delivery Truck
523 Delivery Expense
11.
125 Equipment
525 Truck Repair and Maintenance Expense
Dec.
Record depreciation for the new truck. It has an estimated residual value of S8,950 and an estimated
126 Accumulated Depreciation-Equipment
529 Selling Expenses
31.
life of five years.
130 Mineral Rights
531 Rent Expense
Year 3
131 Accumulated Depletion
532 Depreciation Expense-Equipment
July 1.
Purchased a new truck for $53,920, paying cash.
132 Goodwill
533 Depletion Expense
Oct. 2
Sold the truck purchased January 6, Year 2, for $17,125. (Record depreciation to date for Year 3 for
133 Patents
534 Amortization Expense-Patents
the truck.)
535 Insurance Expense
Dec.
Recorded depreciation on the remaining truck. It has an estimated residual value of $12,945 and an
LIABILITIES
536 Supplies Expense
31.
estimated useful life of eight years.
210 Accounts Payable
539 Miscellaneous Expense
211 Salaries Payable
710 Interest Expense
213 Sales Tax Payable
720 Loss on Sale of Delivery Truck
Journalize the transactions and the adjusting entries. Refer to the Chart of Accounts for exact wording of account titles.
214 Interest Payable
721 Loss on Sale of Equipment
215 Notes Payable
EQUITY
310 Common Stock
311 Retained Earnings
312 Dividends
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