Question

1. A company sells a fixed asset (equipment) for $30,000. The asset originally cost $80,000 and had accumulated depreciation of $55,000 at the time of the sale. Record the journal entry to recognize the sale.

2. A company scraps a fully depreciated piece of equipment originally costing $20,000. They did not receive any proceeds. Record the journal entry.

3. A company sells a piece of plant equipment for $2,000. The original cost was $10,000 and the accumulated depreciation through the date of the sale was $6,500. Record the journal entry.

4. A company trades in a truck for a new one. The old truck had an original cost of $20,000 and accumulated depreciation of $14,000. The new truck had a sticker price on the window of $25,000. The dealer gave a $7,500 trade in allowance and the company wrote a check to the dealer for $15,750. Record the journal entry.

5. Define depletion (10 points)

6. A company sells 200,000 shares of newly issued common stock having a par value of $1 for $8.50 per share. Record the journal entry.

7. A company has net income of $4,580,000. There are 200,000 shares of $50 par, 6% preferred stock outstanding and 800,000 shares of common stock. What is the net income per common share (earnings per share). Show your calculation.

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1. A company sells a fixed asset (equipment) for $30,000. The asset originally cost $80,000 and had accumulated depreciation of $55,000 at the time of the sale. Record the journal entry to recognize the sale.

Cash 30,000
Accumulated Depreciation 55,000
Equipment 80,000
Gain on Sale of Asset 5,000
To record the sale of equipment...

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