At December 31, 2012, Rivera Corporation reported the following plant assets.
| Land Don't use plagiarized sources. Get Your Custom Essay on at december 31 2012 rivera corporation reported the following plant assets 534570 For $10/Page 0nly | ||
| Buildings | $26,500,000 | $ 3,000,000 |
| Less: Accumulated depreciation—buildings | 11,925,000 | 14,575,000 |
| Equipment | 40,000,000 | |
| Less: Accumulated depreciation—equipment | 5,000,000 | 35,000,000 |
| Total plant assets | $52,575,000 |
During 2013, the following selected cash transactions occurred.
Apr. 1 Purchased land for $2,200,000.
May 1 Sold equipment that cost $600,000 when purchased on January 1, 2006. The equipment was sold for $170,000.
June 1 Sold land for $1,600,000. The land cost $1,000,000.
July 1 Purchased equipment for $1,100,000.
Dec. 31 Retired equipment that cost $700,000 when purchased on December
Dec. 31, 2003. No salvage value was received.
Instructions
(a) Journalize the transactions. (Hint:You may wish to set up T accounts, post beginning balances, and then post 2013 transactions.) Rivera uses straight-line depreciation for buildings and equipment. 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. Update depreciation on assets disposed of at the time of sale or retirement.
(b) Record adjusting entries for depreciation for 2013.
(c) Prepare the plant assets section of Rivera”s balance sheet at December 31, 2013.
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