Homework answers / question archive / Sunland Ltd

Sunland Ltd

Accounting

Share With

Sunland Ltd. purchased an electric wax melter on April 30, 2020, by trading in its old gas model and paying the balance in cash. The following data relate to the purchase: $15,600 8,600 List price of new melter Cash paid Cost of old melter (5-year life, $680 residual value) Accumulated depreciation on old melter (straight-line) Market value of old melter in active secondary market 14,180 8,100 6,440 Assuming that Sunland's fiscal year ends on December 31 and depreciation has been recorded through December 31, 2019, prepare the journal entries that are necessary to record this exchange. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter for the amounts.) Account Titles and Explanation Debit Credit (To record depreciation expense to date of exchange) (To record equipment exchange)