Brown Company paid cash to purchase the assets of Coffee Company on January 1. 2019. Information is as follows: Total cash paid S3,500,000 Assets acquired: Land se00,000 5500,000 5900,000 5500.000 Building Machinery Patents The building is depreciated using the double-declining balance method. Other information is: Salvage value Estimated useful life in years S50,000 The machinery is depreciated using the units-of-production method. Other information is: Salvage value, percentage of cost Estimated total production output in Actual production in units was as 10% 200,000 40,000 O0,000 20,000 2019 2020 2021 The patents are amortized on a straight-line basis. They have no salvage Estimated useful life of patents in On December 31, 2020, the value of the patents was estimated to be 30 $100,000 Where applicable, the company uses the % year rule to calculate depreciation and amortization expense in the years of acquisition and disposal. Its fiscal year-end is December 31. The machinery was traded on December 2, 2021 for new machinery. Other information is: S240,000 $288,000 $403,200 20 S8,064 Fair value of old machinery Trade-in allowance List price for new machinery Estimated useful life of new machinery in Estimated salvage value of new The new machinery is depreciated using the straight-line method and On August 14, 2023, an addition was made. This amount was material. Other relevant information is as follows: Amount of addition, paid in cash $100,000 Number of years of useful life from 2023 (original machinery and addition): Salvage value, percentage of addition 30 10% Required: Prepare journal entries to record: 1 The purchase of the assets of Coffee. 2 Depreciation and amortization expense on the purchased assets for 2o 3 The decine (if any) in value of the patents at December 31 4 The trade-in of the old machinery and purchase of the new 5 Depreciation on the new machinery for 2021. 6 Cost of the addition to the machinery on August 14, 2023. 7 Depreciation on the new machinery for 2023.

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Brown Company paid cash to purchase the sets of Coffee Company on January 1, 2019. Information is as follows Total cash paid $3.500.000 Assets acquired Land SCOO 000 Building SLOD OOO Machinery 3900.000 Patents doo doo The building is depreciated using the double-declining balance method Other information is Salvage value 550.000 Estimated useful life in years The machinery is depreciated using the units of production method Other information is Salvage value, percentage of cost 10% Estimated total production output in 200 DOO Actual production in units was as 2019 40.000 LOUOU 2021 2020 The patents are amortized on a straigh-line basis. They have no salvage Estimated useful life of patents in 30 On December 31, 2020, the value of the patents was estimated to be $100.000 Where applicable, the company uses the year rule to calculate depreciation and amortization expense in the years of acquisition and disposal. Its fiscal year-end is December 31 The machinery was traded on December 2 202 for new machinery Other information is: Fair value of old machinery 5240 000 Trade-in allowance 5.000 List price for new machinery Estimated useful life of new machinery in Estimated salvage value of new 30.064 The new machinery is depreciated using the straight line method and On August 14, 2023, an addition was made. This amount was material. Other relevant information is as follows: Amount of addition, paid in cash $100.000 Number of years of useful life from 2023 (original machinery and addition) 30 Salvage value. percentage of addition Required. Prepare journal entries to record 1 The purchase of the assets of Coffee 2 Depreciation and amortization expense on the purchased assets for 20 3 The decline of any) in value of the patents at December 31 4 The trade-in of the old machinery and purchase of the new 5 Depreciation on the new machinery for 2021 o Cost of the addition to the machinery on August 14, 2023 7 Depreciation on the new machinery for 20:23