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P9-2A At December 31, 2007, Ruiz Corporation reported

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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
Submitted: 7 years ago.
Category: Homework
Expert:  Neo replied 7 years ago.
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