Reference no: EM133002771
Morley Ltd completed the following transactions over a period of several years.
Purchased land and a building for $450,000 cash. The land and the building had appraised values at that time of $150,000 and $350,000 respectively.
March 29
Paid $30,000 to Re-Nu Company Ltd for renovation costs on the building acquired on I January. Morley Ltd opened for business on 1 April. The building has a useful life of 25 years and a residual value of $15,000. The company depreciates on straight line basis.
December 31
Recorded depreciation expense on the building.
2007
May 21
Paid $2,642 to repair damage to the building caused by a storm.
December 31
Recorded depreciation expense on the building.
2008
December 31
Recorded depreciation expense on the building and decided to record the building at fair value of $360,000. The useful life and residual value remain unchanged.
2009
September 30
The land and buildings were sold for $550,000 cash.
Required:
Problem 1: Provide entries using a general journal format to record the above transactions.
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