I need help on this problem for my accounting homework.

timer Asked: Dec 17th, 2014

Question description

Cassel and Company negotiates a lump-sum purchase of several assets from a contractor who is relocating. The purchase is completed on January 1, 20XX, at a total cash price of $1,720,000 for a building, land, land improvements and equipment. The appraised value of the assets are building, $895,400; land, $430,200; land improvements, $248,200; and equipment, $203,900. The Company's fiscal year ends December 31. 

A. Prepare a table to allocate the lump-sum purchase price to the separate assets purchased. Prepare the journal entry to record this purchase. 

B. Compute the depreciation expense for the first year on the building using the straight-line method, assuming a 12 year life and a $120,000 salvage value. 

C. Compute the depreciation expense for the first and second years on the land improvements assuming a 10 year life, using the double-declining balance method. 

Round all calculations to the nearest whole dollar or percent.

Studypool has helped 1,244,100 students
flag Report DMCA
Similar Questions
Hot Questions
Related Tags

Brown University

1271 Tutors

California Institute of Technology

2131 Tutors

Carnegie Mellon University

982 Tutors

Columbia University

1256 Tutors

Dartmouth University

2113 Tutors

Emory University

2279 Tutors

Harvard University

599 Tutors

Massachusetts Institute of Technology

2319 Tutors

New York University

1645 Tutors

Notre Dam University

1911 Tutors

Oklahoma University

2122 Tutors

Pennsylvania State University

932 Tutors

Princeton University

1211 Tutors

Stanford University

983 Tutors

University of California

1282 Tutors

Oxford University

123 Tutors

Yale University

2325 Tutors