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ACC 291 Learning Team Study Guide Week 2 – PaperScholar Study Aids
Guide Last Updated: October 9, 2015
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ACC 291 Learning Team Study Guide Week 2 –

ACC 291 Learning Team Study Guide Week 2


 

Resources: Ch. 9 of Financial Accounting.

Complete the one assigned learning team problem found in the Week 2 Microsoft® Excel® template provided in the Course Materials forum.

Submit the completed Microsoft® Excel® template to the Assignments Tab.

 

Problem 1 At December 31, 2011, Jimenez Company reported the following as plant assets.
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.
Apr 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.
Jun 1 Sold land purchased on June 1, 2002 for $1,500,000.The land cost $400,000.
Jul 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.
Instructions
(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.