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P9-2A ; At December 31, 2007, Ruiz Corporation reported the following plant assets. &nb sp; Land $3,000,000 Buildings $26,500,000 Less: Accumulated depreciation—buildings 12,100,000 $14,400,000 Equipment &nb sp; 40,000,000 Less: Accumulated depreciation—equipment 5,000,000 $35,000,000 Total plant assets $52,400,000 &nb sp; During 2008, the following selected cash transactions occurred. &nb sp; Apr 1 Purchased land for $2,200,000 May 1 Sold equipment that cost $660,000 when purchased on January 1, 2001. The equipment was sold for $200,000 Jun 1 Sold land for $1,800,000 The land cost $700,000 Jul 1 Purchased equipment for $1,300,000 Dec 31 Retired equipment that cost $500,000 when purchased on December 31, 1998. No salvage value was received. &nb sp; Instructions: &nb sp; (a) Journalize the transactions. (Hint: You may wish to set up T accounts, post beginning balances, and then post 2008 transactions.) Ruiz 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. &nb sp; &nb sp; &nb sp; &nb sp; &nb sp; Apr 1 Account title Amount Account title Amount &nb sp; May 1 Account title Amount Account title Amount Calculations as desired &nb sp; May 1 Account title Amount Account title Amount Account title Amount Account title Amount &nb sp; Calculations as desired &nb sp; &nb sp; &nb sp; &nb sp; &nb sp; &nb sp; Jun 1 Account title Amount Account title Amount Account title Amount &nb sp; Jul 1 Account title Amount Account title Amount &nb sp; Dec 31 Account title Amount Account title Amount &nb sp; Dec 31 Account title Amount Account title Amount &nb sp; Calculations as desired &nb sp; &nb sp; &nb sp; (b) Record adjusting entries for depreciation for 2008. &nb sp; Dec 31 Account title Amount Account title Amount Calculations as desired &nb sp; Dec 31 Account title Amount Account title Amount &nb sp; Calculations as desired &nb sp; &nb sp; &nb sp; &nb sp; (c) Prepare the plant assets section of Ruiz’s balance sheet at December 31, 2008. &nb sp; RUIZ CORPORATION Partial Balance Sheet December 31, 2008 Plant Assets Account title Amount Account title Amount Account title Amount Formula Account title Amount Account title Amount Formula Total plant assets Formula &nb sp; Land &nb sp; &nb sp; &nb sp; &nb sp; &nb sp; Buildings&n bsp; &nb sp; &nb sp; &nb sp; &nb sp; &nb sp; Equipment &nb sp; &nb sp; &nb sp; &nb sp; &nb sp; &nb sp; Accumulated Deprecia tion—Buildings &nb sp; &nb sp; &nb sp; &nb sp; &nb sp; Accumulated Depreciation—Equipment
Optional Information: Level/Year: SO Subject: Accounting
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Experience: BS Accounting