A company paid $120,000 for equipment on April 1, 2012. The equipment was expected to have a 10-year useful life and residual value of $20,000. Assume that the company uses DDB for income taxes and straight-line for financial reporting. For each method, calculate depreciation expense for the first two years. (Round your answers to the nearest whole dollar.) Depreciation for Year-end income taxes Straight-Line 24000 December 31, 2012 December 31, 2013 10000 10,000 19200 14000 9200 Total The extra depreciation expense over the first two years using DDB (the income tax method) is $23200 1. Cheap Banners pays $300,000 cash for a group purchase of land, building, and equipment. At the time of acquisition, the land has a market value of $93,000, the building $201,500, and the equipment $15,500. Journalize the lump-sum purchase. Percentage Market of Total Asset Value Land Value 93,000 201,500 15,500 Building Equipment Total $ 310,000 100% Total Assigned Purchase Cost of Price - Each Asset = $ 90,000 195,000 15,000 $ 300,000