Prepare the Journal Entries to Record the Following Transactions for Reese

question 104

Essay

Prepare the journal entries to record the following transactions for Reese Company, which has a calendar year end and uses the straight-line method of depreciation.
(a) On September 30, 2014, the company sold old equipment for $46,000. The equipment was purchased on January 1, 2012, for $96,000 and was estimated to have a $16,000 salvage value at the end of its 5-year life. Depreciation on the equipment has been recorded through December 31, 2013.
(b) On June 30, 2014, the company sold old equipment for $24,000. The equipment originally cost $36,000 and had accumulated depreciation to the date of disposal of $15,000.

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Definitions:

Operations Management

The aspect of management dedicated to the design, administration, and supervision of the manufacturing process, along with the modification of business operations in the generation of products or services.

Nineteenth Century

The Nineteenth Century is the period from 1801 to 1900, characterized by significant industrial, cultural, and political changes worldwide.

Interchangeable Parts

Components designed to be exactly similar so they can be easily replaced or assembled without customization.

Manufacturing

The process of producing goods by transforming raw materials into finished products, using labor, machinery, and chemical processing.