Timberly Construction makes a lump - sum purchase of several assets on January 1 at a tota cash price of $810,000. The estimated market values of the purchased assets are building, 487,600; land, $285, 200; land improvements, $73,600; and four vehicles, $73,600. Allocate the lump - sum purchase price to the separate assets purchased. Prepare the journal entry to record the purchase. Compute the first-year depreciation expense on the building using the straight-line method, assuming a 15-year life and a $31,000 salvage value. Compute the first-year depreciation expense on the land improvements assuming a five-year life and double-declining - balance depreciation.

Timberly Construction makes a lump - sum purchase of several assets on January 1 at a tota cash price of $810,000. The estimated market values of the purchased assets are building, 487,600; land, $285, 200; land improvements, $73,600; and four vehicles, $73,600. Allocate the lump - sum purchase price to the separate assets purchased. Prepare the journal entry to record the purchase. Compute the first-year depreciation expense on the building using the straight-line method, assuming a 15-year life and a $31,000 salvage value. Compute the first-year depreciation expense on the land improvements assuming a five-year life and double-declining - balance depreciation.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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