2023 At December 31 2011 Jimenez Company reported the following as plant assets Land | Assignments Online

At December 31, 2011, Jimenez Company reported the following as plant assets.

 

Land                                                                                $ 4,000,000

Buildings                                                     $28,500,000

Less: Accumulated depreciation—buildings      12,100,000    16,400,000

Equipment                                                   48,000,000

Less: Accumulated depreciation—equipment    5,000,000     43,000,000

             Total plant assets                                                $63,400,000

 

During 2012, the following selected cash transactions occurred.

 

April 1  Purchased land for $2,130,000.

May 1   Sold equipment that cost $780,000 when purchased on January 1, 2008.The equipment

was sold for $450,000.

June 1 Sold land purchased on June 1, 2002 for $1,500,000.The land cost $400,000.

July 1 Purchased equipment for $2,000,000.

Dec. 31 Retired equipment that cost $500,000 when purchased on December 31, 2002. No salvage value was received.

 

Requirements:

 

A.  Journalize the above transactions.The company uses straight-line depreciation for buildings and equipment.The buildings are estimated to have a 50-year 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.

 

B.  Record adjusting entries for depreciation for 2012.

 

C.  Prepare the plant assets section of Jimenez’s balance sheet at December 31, 2012.

 

 

Check figures:

b.  Depreciation Expense—building  $570,000;   equipment   $4,772,000

c.  Total plant assets    $61,270,000