Reference no: EM131692500

Q1. A Company sells goods to customers who use Worldwide Express non-bank credit cards. Credit card sales on July 15, 2016 amounted to $25,000 and were subject to a 3.5% credit card company collection fee. Alpha Company collected payment from Worldwide Express on July 21. Use this information to prepare the General Journal entries (without explanation) for the July 15 sales & the July 21 collections.

Q2. On July 1, 2016, A Company purchased for $78,000, equipment having a service life of eight years and an estimated residual value of $6,000. Alpha has recorded depreciation of the equipment using the double-declining balance method. On December 31, 2019, before making any annual adjusting entries, the equipment was sold for $20,000. Use this information for a General Journal entry required to record the events for December 31, 2019.

Q3. On July 1, 2016, A Company purchased for $72,000, equipment having a service life of eight years and an estimated residual value of $6,000. Alpha has recorded depreciation of the equipment using the double-declining balance method. On December 31, 2018, before making any annual adjusting entries, the equipment was exchanged for new machinery having a fair value of $32,500. The transaction has commercial substance. Use this information for a General Journal entry required to record the events for December 31, 2018.