On 1/1/2000 obama company purchased all of the assets of biden company for book value. On 1/1/2009 obama company purchased a truck for $200,000. This truck is expected to last 20 years with no salvage. On 1/1/2014 ghi sold this truck to biden for $180,000 receiving a 10% note. This note pays interest annually on january 1st. Biden expects the truck to last 15 years with no salvage. On 1/1/2016 biden sells the truck to outside company for $152,000 and pays off the note to obama
REQUIRED:
1) Make the entry OBAMA makes when it sells the truck to BIDEN
2) Make the entry BIDEN makes when it buys the truck
3) Make the adjusting entry BIDEN makes on 12/31 connected with the note
4) Make the adjusting entry OBAMA makes on 12/31 connected with the note
5) Make the worksheet entries connected with this intercompany sale of the truck for 2014
6) What are the balances in the following accounts in the 2014 consolidated financial statements
a) Truck
b) Accumulated depreciation
c) Depreciation expense
d) Gain/loss on sale
e) Note payable
f) Interest expense
6) Make the worksheet entries connected with this truck in 2015
7) What are the balances in the following accounts in 2015 consolidated financial statements
a) Truck
b) Accumulated depreciation
c) Depreciation expense
d) Gain/loss on sale
e) Note payable
f) Interest expense
8) Make the entry BIDEN makes in 2016 when it sells the truck to Outside company
9) Make the necessary worksheet entries needed in 2016 related to this truck
10) What are the balances in the following consolidated accounts in 2016
a) Truck
b) Accumulated depreciation
c) Depreciation expense
d) Gain/loss on sale
e) Note payable
f) Interest expense