Togo’s Sandwich Shop had the following long-term asset balances as of January 1, 2024:

Additional information:
· Togo’s purchased all the assets at the beginning of 2022.
· The building is depreciated over a 10-year service life using the double-declining-balance method and estimating no residual value.
· The equipment is depreciated over a nine-year service life using the straight-line method with an estimated residual value of $10,000.
· The patent is estimated to have a five-year useful life with no residual value and is amortized using the straight-line method.
· Depreciation and amortization have been recorded for 2022 and 2023 (first two years).

Required:
1. For the year ended December 31, 2024 (third year), record depreciation expense for buildings and equipment. Land is not depreciated.
2. For the year ended December 31, 2024, record amortization expense for the patent.
3. Calculate the book value for each of the four long-term assets at December 31, 2024.

Transcribed Image Text:

Land Building Equipment Patent Cost $ 85,000 560,000 145,000 125,000 Accumulated Depreciation $(201,600) (30,000) (50,000) Book Value $ 85,000 358,400 115,000 75,000