Acquisition of An Asset:

Moss Piano Company purchases a tract of land and an existing building for $$1,000,000.$ The company plans to remove the old building and construct a new restaurant on the site. In addition to the purchase price, Moss pays closing costs, including title insurance of $$3,000.$ The company also pays $$14,000$ in property taxes, which includes $$9,000$ of back taxes $($unpaid taxes from previous years$)$ paid by Moss on behalf of the seller and $$5,000$ due for the current fiscal year after the purchase date. Shortly after closing, the company pays a contractor $$50,000$ to tear down the old building and remove it from the site. Moss is able to sell salvaged materials from the old building for $$5,000$ and pays an additional $$11,000$ to level the land.

Determine the cost of the land.

Depreciation and Disposal

The Moss Piano Company purchased a Delivery Truck on January $1,2025$ for $$50,000$ which included all costs to get the asset ready for use. The truck has an anticipated life of $100,000$ miles or $4$ years. The estimated residual value at the end of the assets service life is expected to be $$2,000.$ For assets of this type, the company utilizes the straight$-$line depreciation method.

A$)$ Record the purchase of the asset.

$\backslash$table$[[$A$,$L$,$SE$,$R$,$E$,$NI$,$CF$,$Account,DR$,$CR$],[,,,,,,,,,]]$

B$)$ Complete the depreciation table below.

$\backslash$table$[[$Period Ended,$\backslash$table$[[$Depreciation$],[$Expense$]],\backslash$table$[[$Accumulated$],[$Depreciation$]],\backslash$table$[[$End of Period Book$],[$Value$]]],[$December $31,2025,,,],[$December $31,2026,,,],[$December $31,2027,,,],[$December $31,2028,,,]]$

C$)$ Record the entry for December $31,2025$ to record the depreciation for the year.

$\backslash$table$[[$A$,$L$,$SE$,$R$,$E$,$NI$,$CF$,$Account,,,$],[,,,,,,,,,,]]$

D$)$ Suppose the company sells the van on December $31,2027$ for $$18,000$ cash. Provide the journal entry to record the sale.

$\backslash$table$[[$A$,$L$,$SE$,$R$,$E$,$NI$,$CF$,$Account,,$],[,,,,,,,,,]]$

E$)$ Assume the company chooses to use the units$-$of$-$production method. Based on the information below, complete the depreciation schedule.

$\backslash$table$[[$Year$,$Miles Driven$],[2025,27\mathrm{.}000],[2026,24\mathrm{.}000],[2027,32\mathrm{.}000],[2028,22\mathrm{.}000]]$

$\backslash$table$[[$Period Ended,$\backslash$table$[[$Depreciation$],[$Expense$]],\backslash$table$[[$Accumulated$],[$Depreciation$]],\backslash$table$[[$End of Period Book$],[$Value$]]],[$December $31,2025,,,],[$December $31,2026,,,],[$December $31,2027,,,],[$December $31,2028,,,]]$