4. In preparation for preparing the adjusting entries, complete depreciation schedules for the first five years for the depreciable plant assets, assuming the assets were purchased on January 2, 2018: a. Building, straight-line, 30 years, $50,000 residual value. b. Store Fixtures, straight-line, 15 years, no residual value. c. Office Equipment, double-declining-balance, 5 years, $5,000 residual value. Plant Assets, Natural Resouro In addition to purchasing the franchise, Top Quality Appliance-Long Be Beach will also purchase land with an existing building to use for its retail store, store fixtures, a cquipment. The business will purchase appliances from TQA and resell them in its store. primarily to local building contractors for installation in new homes Following is the chart of accounts for Top Quality Appliance- Long Beach. As a new business, all beginning balances are so nd office Top Quality Appliance-Long Beach Chart of Accounts Cash Petty Cash Accounts Receivable Allowance for Bad Debts Merchandise inventory Office Supplies Prepaid Insurance Interest Receivable Notes Receivable Land Building Accumulated Depreciation-Building Store Fixtures Accumulated Depreciation-Store Fixtures Credit Card Expense Office Equipment Accumulated Depreciation-Office Equipment Depreciation Expense-Store Fixtures Franchise Accounts Payable Interest Payable Notes Payable Common Stock Retained Earnings Dividends Sales Revenue Interest Revenue Cost of Goods Sold Franchise Fee Expense Salaries Expense Utilities Expense Insurance Expense Supplies Expense Bad Debt Expense Bank Expense Depreciation Expense-Building Depreciation Expense-Office Equipment Amortization Expense-Franchise Interest Expense Cash Short and Over -longBeachcompleted the following transactions during 2018, its first year of operations: Received $500,000 cash and issued common stock. Opened a new checking account at Long Beach National Bank and deposited the cash received from the stockholders a. b. Paid $50,000 cash for a TQA franchise. Paid $200,000 cash and issued a $400,000, 10-year, 5% notes payable for land with an existing building. The assets had the following market values: Land, $100,000; Building, $500,000. c. d. Paid $75,000 for store fixtures. e. Paid $45,000 for office equipment f. Paid $600 for office supplies. g. Paid $3,600 for a two-year insurance policy h. Purchased appliances from TOA (merchandise inventory) on account for $425,000 i. Established a petty cash fund for $150 Sold appliances or acount to B&B Contractors for $215,000, terms n/30 (cost, $86,000) k. Sold appliances to Davis Contracting for $150,000 (cost, $65,000), receiving a 6-month, % note. l. Recorded credit card sales of $80,000 (cost, $35,000), net of processor fee of 2%. m. Received payment in full from B&B Contractors n. Purchased appliances from TQA on account for $650,000 o. Made payment on account to TQA, $300,000. p. Sold appliances for cash to LB Home Builders for $350,000 (cost, $175,000). q. Received payment in full on the maturity date from Davis Contracting for the note. r. Sold appliances to Leard Contracting for $265,000 (cost, $130,000), receiving a 9-month, 8% note. s. Made payment on account to TQA, $500,000. t. Sold appliances on account to various businesses for $985,000, terms n/30 (cost, $395,000). u. Collected $715,000 cash on account. v. Paid cash for expenses: Salaries, $180,000; Utilities, $12,650 w. Replenished the petty cash fund when the fund had $62 in cash and petty cash tickets for $85 for office supplies. x. Paid dividends, $5,000 y, Paid the franchise fee to TQA of 5% of total sales of $2,045,000