1. On January 1, 2024, Hugo Enterprises paid cash to acquire the assets of an existing company. Among the assets acquired were the following items.

Patent $55,000 (remaining life 4 years)

Goodwill $44,500

Hugo's financial condition just prior to the acquisition of these assets is shown in the following statements model.

Required:

a. Compute the annual amortization expense for these items.

b. Show the acquisition of the intangible assets.

c. Show the related amortization expense for Year 1 in a horizontal statements model.

2. Harley, Inc. purchased the following fixed assets during 2024.

-Equipment with a purchase price of $45,000 and freight of $1,000. Purchased on April 1, 2024 with cash. This asset is estimated to last 10 years and have a salvage value of $2,500.

-Building with a purchase price of $550,000 and realtor and title fees of $15,000. The building was purchased on November 30, 2024 and is expected to be usable for 30 years, with a salvage value of $25,000.

Required:

a. Calculate Harley's depreciation expense for year end, December 31, 2024.

b. Record the 2024 depreciation expense for the equipment in the general journal. Use one J/E to record Equipment depreciation and another to record the building depreciation.

c. Show all entries to 2 decimal places.