December 23 issued check 30109 and purchased additional store fixtures for better display and security of merchandise. The equipment lists for $4200 with trade discounts of 40% and 10% and sales tax on the net amount. ???
The total amount paid would be:
$4,200 X .60 X 1.10 = $2,772
The entry would be:
Debit Store Fixtures $2,772
Credit Cash $2,772
December 24 sold a used piece of shop equipment for $1995. The equipment was purchased at a total cost of $7200 in 2001. using units of production depreciation the accumulated depreciation account balance at the end of the quarter is $2850 (sept. 30) Deprecation rate is $2.00 per hour of operation. to December 24 and additional 234 hours of operation have accumulated. Two entries are required to properly record this sale. ???
First you need to record the additional depreciation for the period of October 1 - December 24.
The additional hours of 234 is multiplied by the $2.00 per hour rate to give you the additional depreciation amount of (234 X $2.00) = $468. The entry would be:
Debit Depreciation Expense $468
Credit Accumulated Depreciation - Equipment $468
Then you need to record the sale of the equipment. To calculate the gain or loss, you need to know the Net Book Value of the equipment on the date of sale.
The Accumulated Depreciation at September 30 is $2,850. You add the additional depreciation expense of $468 to that to come up with a value in Accumulated Depreciation of $3,318.
They paid $7,200 for the equipment, so the Net Book Value on the date of sale was $7,200 - $3,318) = $3,882.
Since they only received $1,995 for the equipment, they lost ($1,995 - $3,882) = -$1,887 on the sale.
The entry to record this is:
Debit Cash $1,995
Debit Loss on Sale of Equipment $1,887
Debit Accumulated Depreciation - Equipment $3,318
Credit Fixed Assets - Equipment $7,200
December 31 Sold for 9 3/4 the remaining 500 shares of the Ramblewood Manufacturing Corporation common stock that was held as a short-term investment. The commissions charge was $126. This stock was a part of a block of 1000 shares purchased earlier at a total cost of $9250. ???
$9.75 X 500 = $4,875
They paid a $126 commission so the net amount they received for the shares was ($4,875 - $126) = $4,749
The average price paid for the 500 shares was ($9,250 / 1,000) = $9.25 per share. $9.25 X 500 = $4,625.
They paid $4,625 to obtain the shares and received $4,749 when they sold them. The difference is ($4,749 - $4,625) = $124. So they earned a gain of $124 on these shares. The entry to record this is:
Debit Cash $4,749
Credit Short-Term Investments $4,625
Credit Gain on Sale of Short Term Investments $124