Provide the journal entries for the sale

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Answer the following questions and show work.

Question II: Fedex Express acquired a delivery truck on January 1, 2009 for $48,000. Its firmmanager estimated that the truck would have a useful life of 6 years and a $6,000 salvage value.Fedex Express uses the straight-line depreciation method. On July 1, 2013 Fedex Express soldthe truck for $14,000. Give the Journal Entries that Fedex Express manager would make on July1, 2013 to recognize depreciation for 2013. Also, provide the Journal Entries for the sale of thetruck.

Question III: Southwest purchased a Boeing 747 aircraft for $70 million in cash, which wasborrowed from Bank of America with $5 million financing fees. In addition, Southwest paid$200,000 to have the plane delivered and $300,000 to prepare the new plane for use (both in cash).The aircraft is depreciated using the straight-line method with a useful life of 20 years and anestimated residual value of $5 million. In the sixth year, Southwest changed the estimated usefullife to 25 years and lowered the residual value to $1.5 million. Calculate depreciation expense forthe sixth, fifteenth, and twenty-fifth year using the straight-line method. What is the journal entryfor the sixth year? Finally, does the change in the depreciation estimates affect net income for thesixth year? If yes, assume that net income for the fifth year and the sixth year is the same andexplain how the net income for the sixth is affected (compared to that for the fifth year)?

Reference no: EM131876410

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