Acc291 Principles of Accounting: P9-2A At December 31, 2014, Navaro Corporation reported

Acc291 Principles of Accounting

Problem 9-2A Journalize equipment transactions related to purchase, sale, retirement, and depreciation.
At December 31, 2014, Navaro Corporation reported the following plant assets.
Land 4,671,000
Buildings 30,820,000
Less: Accumulated depreciation-buildings 18,567,225 12,252,775
Equipment 62,280,000
Less: Accumulated depreciation-equipment 7,785,000 54,495,000
Total plant assets 71,418,775

During 2015, the following selected cash transactions occurred.
Apr. 1 Purchased land for $3,425,400.
May 1 Sold equipment that cost $934,200 when purchased on January 1, 2008. The equipment was sold for $264,690.
June 1 Sold land for $2,491,200. The land cost $1,557,000.
July 1 Purchased equipment for $1,712,700.
Dec. 31 Retired equipment that cost $1,089,900 when purchased on December 31, 2005. No salvage value was received.

Instructions:
a. 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 entries in the order displayed in the problem statement. Credit account titles are automatically indented when amount is entered. Do not indent manually.)
b. Record adjusting entries for depreciation for 2015.
c. Prepare the plant assets section of Navaro's balance sheet at December 31, 2015.
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