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Brown Company paid cash to purchase the assets of Coffee Company on January 1. 2019. Information is as follows: Total cash paid $3.500.000 Assets acquired:

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Brown Company paid cash to purchase the assets of Coffee Company on January 1. 2019. Information is as follows: Total cash paid $3.500.000 Assets acquired: Land $600.000 Building $500.000 Machinery $900.000 Patents $500.000 The building is depreciated using the double-declining balance method. Other information is: Salvage value $50.000 Estimated useful life in years 40 The machinery is depreciated using the units-of-production method. Other information is: Salvage value, percentage of cost 10% Estimated total production output in 200.000 Actual production in units was as 2019 40.000 2020 80.000 2021 20.000 The patents are amortized on a straight-line basis. They have no salvage valu!. 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 1% 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: Fair value of old machinery $240.000 Trade-in allowance $288.000 List price for new machinery $403.200 Estimated useful life of new machinery in 20 Estimated salvage value of new $8.064 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 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 2019. 3 The decline (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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