Reference no: EM133157569

Question - Prada company ´s accounts include Land, Buildings, Office Equipment, and Communication Equipment, with a separate accumulated depreciation account for each asset. During 2007, Prada completed the following transactions:

Jan. 1 Traded in old office equipment with book value of $11,000 (cost of $96,000 and accumulated depreciation of $85,000) for new equipment. Prada also paid $19,000 in cash.

Apr. 1 Acquired land and communication equipment in a group purchase. Total cost was $80,000 paid in cash. An independent appraisal valued the land at $90,000 and the communication equipment at $10,000.

Sep. 1 Sold a building that had cost $128,000 (accumulated depreciation of $100,000 through December 31 of the preceding year). Prada received $60,000 cash from the sale of the building. Depreciation is computed on a straight-line basis. The building has a 30-year useful life and a residual value of $20,000.

Dec. 31 Recorded depreciations as follows:

-Communication equipment is depreciated by the straight-line method over a 5-year life with zero residual value.

-Office equipment is depreciated straight-line over 6 years with $3,000 residual value.

Required -

Record the transactions for Prada.

Please solve with all explanations, thanks in advance.