Allocation of Package Purchase Price and Depreciation Methods To expand its business, Small Company paid $754,000 for most of the property, plant, and equipment of a small trucking company that was going out of business. Before agreeing to the price, Small hired a consultant for $6,000 to appraise the assets. The appraised values were as follows: Assessed Value $120,000 Property Land Building Trucks 440.000 144.000 96,000 Equipment Total 5800,000 Small issued two checks totaling $760,000 to acquire the assets and pay the consultant on July 1. Small depreciated the assets using the straight-line method on the building and on the equipment, and the double-declining balance method on the trucks. Estimated useful lives and salvage values were as follows: Salvage Useful Life Building Trucks Equipment a. Calculate the amounts allocated to the various types of plant assets acquired on July 1. Asset s Land Building 4:12 PM a Building Trucks Equipment 20 years $42,000 4 years 15,000 7 years 10,000 a. Calculate the amounts allocated to the various types of plant assets acquired on July 1. Asset Total Land $ Building Trucks Equipment b. Prepare the July 1 journal entries to record the purchase of the assets and the payment to the consultant. Combine both cash disbursements into one journal entry. General Journal Date Description Debit Credit Jul.1 Land Building Trucks Equipment Cash To record purchase of plant assets and payment to consultant. c. Prepare the December 31 journal entries to record depreciation expense for the year on the building, trucks, and equipment. (Round to the nearest dollar.) General Journal Description Debit Credit G Date c. Prepare the December 31 journal entries to record depreciation expense for the year on the building, trucks, and equipment. (Round to the nearest dollar.) General Journal Date Description Debit Credit Dec. 31 To record depreciation on building. Dec. 31 To record depreciation on trucks. - Dec. 31 To record depreciation on equipment. Check Save Answers