Jan 1 Traded in motor-carrier equipment with accumulated dep of $90,000 (cost of $130,000 for similar new equipment with a cash cost of $176,000. Lewis received a trade-in allowance of $70,000 on the old equipment and paid the remainder in cash.

July 1, Sold a building that cost $550,000 and that had a accumulated depreciation of $250,000 through December 31 of the preceding year. Depreciation is computed on a straight-line basis. The building has a 40-year useful life and a residual value of $50,000. Lewis received $100,000 cash and a $600,000 note receivable.

Oct 31, Purchased land and a building for a cash payment of $300,000. An independent appraisal valued the land at $115,000 and the building at 230,000.

Dec 31 Record depreciation as followed:
Motor-carrier equipment has an expected useful life of 1,000,000 miles and an estimated residual value of $26,000. Depreciation is units of production. During the year, Lewis drove his truck 150,000 miles.
Depreciation on buildings is straight-line. The new building has a 40-year useful life and a residual value equal to $20,000

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