Question

Quality Move Company made the following expenditures on one of its delivery trucks: Mar. 20. Replaced the transmission at a cost of $5,430. June 11. Paid $1,705 for installation of a hydraulic lift. Nov. 30. Paid $41 to change the oil and air filter. Prepare the journal entries for each expenditure.

Answer 1

Answer:

The journal entries for each expenditure would be as follows:

                      Debit ($) Credit ($)

Mar. 20

Delivery Truck 5,430  

  Cash                             5,430

June. 11

Delivery Truck 1,705  

  Cash                           1,705

Nov. 30

Repairs and Maintenance Expense 41  

   Cash                                                      41

Explanation:

According to the given data, the journal entries for each expenditure would be as follows:

                      Debit ($) Credit ($)

Mar. 20

Delivery Truck 5,430  

  Cash                             5,430

(To record the replacement of transmission at a cost of $5,430 and capitalizingthe transmission cost)  

June. 11

Delivery Truck 1,705  

  Cash                           1,705

(To record the installation of hydraulic lift and capitalization of installation expenses)  

Nov. 30

Repairs and Maintenance Expense 41  

   Cash                                                      41

(To record the payment for changing the oil and air filter)