Prepare Journal Entries to Record the Following Transactions of a Company

Essay

Prepare journal entries to record the following transactions of a company during the current year:
Mar 1 Purchased a truck for $40,000 with a 5-year useful life and a $5,000 salvage value. Also paid 6% sales tax, $350 for the annual truck license, $300 to paint the truck with the company's colors and name, and $1,500 for maintenance supplies for the future. All payments were in cash. Mar 10 Purchased a garage from a neighboring business with a 7%, 4-year, $67,000 note. The seller's book value for the garage was $42,750. The estimated remaining useful life of the garage is 10 years.
July 5 Paid $800 cash to replace (uninsured) garage windows broken during a storm.
Aug 25 Purchased used shop equipment for $10,700 cash. Sales tax was $825, freight costs $250,
$3,200 for a special base to house the equipment, and reconditioning costs $900, all of which were paid in cash. The estimated useful life of the equipment is 3 years and salvage value is $500.
Oct 5 Purchased office equipment for $11,500 cash. Paid $1,290 in sales tax, $550 for repairs incurred from damage during installation, and $2,200 for supplies to be used for periodic preventive maintenance. The estimated useful life of the equipment is 8 years and salvage value is $1,200.