Problem:
At June 30, 2006, Pouncer Ltd. reported these PPE assets:
Land $4,000,000
Buildings 28,500,000
Less: Accumulated depreciation - buildings 12,100,000 16,400,000
Equipment 48,000,000
Less: Accumulated depreciation - equipment 5,000,000 43,000,000
Total plant assets $63,400,000
During the fiscal year ending June 30, 2006, the following selected cash transactions occurred:
Aug 1 - Purchased land for $2,630,000.
Oct 1 - Sold equipment that cost $675,000 when purchased on January 1, 2000. The equipment was sold for $350,000.
Dec 1 - Sold land purchased on June 1, 1992 for $1,800,000. The land cost $300,000.
During 2007, the following transactions occurred:
Jan 1 - Purchased equipment for $1,000,000.
Jun 30 - Retired equipment that cost $470,000 when purchased on December 31, 1995. No salvage value was received.
Journalize the above transactions. The company 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. (List multiple debit/credit entries in descending order of amount.)
Utilizing the updated accounts, create a partial balance sheet for the Plant Assets Section of the company's financial report for the year ending June 30, 2007.