Swann Company sold a delivery truck on April 1, 2016. Swann had
acquired the truck on January 1, 2012, for $45,500. At acquisition,
Swann had estimated that the truck would have an estimated life of
5 years and a residual value of $3,000. At December 31, 2015, the
truck had a book value of $11,500.

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Question: Swann Company sold a delivery truck on April 1, 2016. Swann had acquired the truck on January 1, …
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Required:

1. Prepare any necessary journal
entries to record the sale of the truck, assuming it sold for:

a. $11,125
b. $7,525
2. How should the gain or loss on
disposal be reported on the income statement?
3. Assume that Swann uses IFRS and
sold the truck for $11,125. In addition, Swann had previously
recorded a revaluation surplus related to this machine of $4,500.
What journal entries are required to record the sale?

X

General Journal

Prepare the necessary journal entries on April 1, 2016 to
record:

1. depreciation expense of the
delivery truck for 2016
2. the sale of the truck, assuming
it sold for $11,125

PAGE 9

GENERAL JOURNAL

DATE ACCOUNT
TITLE
POST.
REF.
DEBIT CREDIT

1

2

3

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