Reference no: EM131811855

Spring Company had the following year end trial balance on 12/31/2015. Prepare the necessary entries for the 2016 transactions listed below. The company uses the perpetual LIFO inventory method. (If necessary round you answers to the nearest dollar). Purchased Land and a Building for $1, 500,000. Borrowed $1, 500,000 to pay for the buiW.ng and signed an installment note. The note has annual payments of $500,000 and is due in 3 years. The note's interest rate is 8%. The first payment will be made on 2/1/17. Before moving into the building an appraisal was conducted which determined the value of the building was $1, 120,000 and the land was $480,000. Sold 305 units of inventory to a customer for $120 each. The customer used a credit card to pay. The credit card company charges a 5% fee for processing the charge. Sold 90 units of inventory to customers for $120 each on account. Paid the short-term note. The interest was properly accrued at last year end. Record the interest on the new note payable Record the bad debt expense for the year. The company estimates account, bad debts will be 3% of Sales on sold the equipment for $3,000 cash. $5,000 residual The equipment is depreciated using straight line over 8 years with a $5,000 residuals