Answered step by step
Verified Expert Solution
Link Copied!
Question
1 Approved Answer

At December 31, 2020, Cord Company's plant asset and accumulated depreciation and amortization accounts had balances as follows: Category Plant Asset Accumulated Depreciation and Amortization

At December 31, 2020, Cord Company's plant asset and accumulated depreciation and amortization accounts had balances as follows:

Category Plant Asset Accumulated Depreciation and Amortization
Land $ 184,000 $
Buildings 1,950,000 337,900
Equipment 1,575,000 326,500
Automobiles and trucks 181,000 109,325
Leasehold improvements 234,000 117,000
Land improvements

Depreciation methods and useful lives: Buildings150% declining balance; 25 years. EquipmentStraight line; 10 years. Automobiles and trucks200% declining balance; 5 years, all acquired after 2017. Leasehold improvementsStraight line. Land improvementsStraight line.

Depreciation is computed to the nearest month and residual values are immaterial. Transactions during 2021 and other information:

  1. On January 6, 2021, a plant facility consisting of land and building was acquired from King Corp. in exchange for 34,000 shares of Cord's common stock. On this date, Cord's stock had a fair value of $50 a share. Current assessed values of land and building for property tax purposes are $210,000 and $630,000, respectively.
  2. On March 25, 2021, new parking lots, streets, and sidewalks at the acquired plant facility were completed at a total cost of $246,000. These expenditures had an estimated useful life of 12 years.
  3. The leasehold improvements were completed on December 31, 2017, and had an estimated useful life of eight years. The related lease, which would terminate on December 31, 2023, was renewable for an additional four-year term. On April 30, 2021, Cord exercised the renewal option.
  4. On July 1, 2021, equipment was purchased at a total invoice cost of $334,000. Additional costs of $10,000 for delivery and $59,000 for installation were incurred.
  5. On September 30, 2021, Cord purchased a new automobile for $13,400.
  6. On September 30, 2021, a truck with a cost of $24,900 and a book value of $10,800 on date of sale was sold for $12,400. Depreciation for the nine months ended September 30, 2021, was $2,430.
  7. On December 20, 2021, equipment with a cost of $21,500 and a book value of $3,200 at date of disposition was scrapped without cash recovery.

Required:

1. Prepare a schedule analyzing the changes in each of the plant asset accounts during 2021. Do not analyze changes in accumulated depreciation and amortization. 2. For each asset category, prepare a schedule showing depreciation or amortization expense for the year ended December 31, 2021.

image text in transcribed

Required 1 Required 2 Prepare a schedule analyzing the changes in each of the plant asset accounts during 2021. Do not analyz accumulated depreciation and amortization. CORD COMPANY Analysis of Changes in Plant Assets For the Year Ending December 31, 2021 Balance Balance 12/31/2020 Increase Decrease 12/31/2021 Land $ 184,000 $ 0 $ 0 0 0 0 1,950,000 Land improvements Buildings Equipment Automobiles and trucks Leasehold improvements 1,575,000 181,000 234,000 4,124,000 $ $ O $ 0 $ 0 Required 1 Required 2 >

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image
Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Creative Accounting, Fraud And International Accounting Scandals

Authors: Michael J. Jones

1st Edition

0470057653, 9780470057650

More Books

Students explore these related Accounting questions