I need help on this problem for my accounting homework.

FratBro23
Category:
Accounting
Price: $5 USD

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.

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