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Homework answers / question archive / At January 1, 2022, Oriole Company reported the following property, plant, and equipment accounts: Accumulated depreciation-buildings Accumulated depreciation equipment Buildings Equipment Land $63
At January 1, 2022, Oriole Company reported the following property, plant, and equipment accounts: Accumulated depreciation-buildings Accumulated depreciation equipment Buildings Equipment Land $63.650,000 55,300,000 97,500,000 151,000,000 22.900,000 The company uses straight-line depreciation for buildings and equipment. its year-end is December 31, and it makes adjusting entries annually. The buildings are estimated to have a 40-year useful life and no salvage value the equipment is estimated to have a 10-year useful life and no salvage value. During 2022, the following selected transactions occurred. Apr1 Purchased land for $4.10 million. Paid $1.025 million cash and issued a 3 year, note payable for the balance Interest on the note is payable annually each April 1 May 1 Sold equipment for $260,000 cash. The equipment cost $282 million when originally purchased on January 1, 2014 June 1 Sold land for 55.60 million. Received $800.000 cash and accepted a war 5% note for the balance The land cost $1.60 million when purchased on June 1, 2016. Interest on the note is due annually each June 1 July 1 Purchased equipment for $2.80 million cach Dec 31 Retired equipment that cost $1 million when purchased on December 31, 2012 No proceeds were received Type here to search
ORIOLE COMPANY Statement of Financial Position (Partial) eTextbook and Media Type here to search AD 4 11 105
Transaction 1: April 1
| Accounts Title | Debit | Credit |
| Land | 4,100,000 | |
| Cash | 1,025,000 | |
| Note Payable | 3,075,000 | |
| [Land purchased ] |
Transaction 2 : May 1
| Accounts Title | Debit | Credit |
| Cash | 260,000 | |
| Accumulated depreciation - equipment [2,820,000/10] X 8.333333 [8 years 4 months] | 2,350,000 | |
| Loss on sale of equipment [Balancing figure ] | 210,000 | |
| Equipment | 2,820,000 | |
| [Equipment sold at a loss] |
Transaction 3 : June 1
| Accounts Title | Debit | Credit |
| Cash | 800,000 | |
| Note Receivable | 4,800,000 | |
| Land | 1,600,000 | |
| Gain on sale of land | 4,000,000 | |
| [Land sold at a gain ] |
Transaction 4 : July 1
| Accounts Title | Debit | Credit |
| Equipment | 2,800,000 | |
| Cash | 2,800,000 | |
| [Equipment purchased for cash ] |
Transaction 5 : December 31
| Accounts Title | Debit | Credit |
| Accumulated depreciation [1,000,000/10] X 10 | 1,000,000 | |
| Equipment | 1,000,000 | |
| [Equipment retied ] |
Necessary Ledger :
Accumulated depreciation - Building
| Accounts Title | $ | Accounts Title | $ |
| Closing balance | 66,087,500 | Opening balance | 63,650,000 |
| Depreciation expense [97,500,000/40] | 2,437,500 | ||
| Total | 66,087,500 | Total | 66,087,500 |
Accumulated depreciation - Equipment
| Accounts Title | $ | Accounts Title | $ |
| Equipment | 2,350,000 | Opening balance | 55,300,000 |
| Equipment | 1,000,000 | Depreciation expense (note 1) | 15,052,000 |
| Closing balance | 67,002,000 | ||
| Total | 70,352,000 | Total | 70,352,000 |
Note 1: Calculation for depreciation expense in 2022:
| Depreciation expense for sold equipment on May 1, 2022 [ 2,820,000 / 10] X 4/12 | 94,000 |
| Depreciation expense for retired equipment on December 31, 2022 [1,000,000 /10] | 100,000 |
| Depreciation expense for equipment in service for the full year apart from the sold or retired equipment [ 151,000,000 - { 2,820,000 + 1,000,000}] /10 | 14,718,000 |
| Depreciation expense for newly purchased equipment on July 1, 2022 [ 2,800,000 / 10 ] X 6/12 | 140,000 |
| Total Depreciation expense in 2022 | 15,052,000 |
Building
| Accounts Title | $ | Accounts Title | $ |
| Opening balance | 97,500,000 | Closing Balance | 97,500,000 |
| Total | 97,500,000 | Total | 97,500,000 |
Equipment
| Accounts Title | $ | Accounts Title | $ |
| Opening balance | 151,000,000 | Cash [Sale Proceeds ] | 260,000 |
| Cash [Purchase] | 2,800,000 | Accumulated depreciation equipment | 2,350,000 |
| Loss on sale of equipment | 210,000 | ||
| Accumulated depreciation - Equipment (Retired equipment ) | 1,000,000 | ||
| Closing balance | 149,980,000 | ||
| Total | 153,800,000 | Total | 153,800,000 |
Land
| Accounts Title | $ | Accounts Title | $ |
| Opening balance | 22,900,000 | Cash/Note Receivable | 1,600,000 |
| Cash | 1,025,000 | Closing balance | 25,400,000 |
| Note Payable | 3,075,000 | ||
| Total | 27,000,000 | Total | 27,000,000 |
ORIOLE COMPANY
Statement of Financial Position (Partial)
As at December 31 ,2022
| Non Current Assets : | ||
| Land | $25,400,000 | |
| Building | $97,500,000 | |
| Accumulated depreciation - Building | $(66,087,500) | $31,412,500 |
| Equipment | $149,980,000 | |
| Accumulated depreciation - Equipment | $(67,002,000) | $82,978,000 |
| Total Non Current Assets | $139,790,500 |
