The following are selected 2019 transactions of Pedigo Corporation.

Instructions

Prepare necessary adjusting entries at December 31 to record amortization required by the events above.

Solution

Gill Company, organized in 2019, has the following transactions related to intangible assets.

Instructions

Prepare the necessary entries to record these intangibles. All costs incurred were for cash. Make the adjusting entries as of December 31, 2019, recording any necessary amortization and reflecting all balances accurately as of that date.

Solution

During 2019, Paola Corporation reported net sales of $3,500,000 and net income of $1,500,000. Its balance sheet reported average total assets of $1,400,000.

Instructions

Calculate the asset turnover.

Solution

Presented below are two independent transactions. Both transactions have commercial substance.

1. Mercy Co. exchanged old trucks (cost $64,000 less $22,000 accumulated depreciation) plus cash of $17,000 for new trucks. The old trucks had a fair value of $38,000.
2. Pence Inc. trandes its used machine (cost $12,000 less $4,000 accumulated depreciation) for a new machine. In addition to exchanging the old machine (which had a fair value of $11,000),, Pence also paid cash of $3,000

Instructions

1. Prepare the entry to record the exchange of assets by Mercy Co.
2. Prepare the entry to record the exchange of assets by Pence Inc.

Solution

Rizzo's Delivery Company and Overland's Express Delivery exchanged delivery trucks on January 1, 2019. Rizzo's truck cost $22,000. It has accumulated depreciation of $15,000 and a fair value of $3,000. Overland's truck cost of $10,000. It has accumulated depreciation of $8,000 and a fair value of $3,000. The transaction has commercial substance.

Instructions

1. Prepare the entry to record the exchange of assets by Mercy Co.
2. Journalize the exchange for Overland's Express Delivery.

Solution