[Byte purchased a building and the land it is on for $137,000 to house it repairs facilities and to store computer equipment. The lot on which the building is located is valued at $22,000. The balance of the cost is to be allocated to the building. Check #5005 was used to make the down payment of $13,700. A 30 yr mortgage with an inital payment due on Aug 1st, was established for the balance.]

1.) The annual interest rate on the mortgage payable was 7.00 percent. Interest expense for one-half month should be computed because the building and land were purchased, and the liability incurred on June 16.

2.) Fixed asssets:

Building - 31.5 years ($115,000)

Computer Equipment - 5 yrs ($157,500)

Office Equipment - 7 yrs ($2,680)

Use the straight line method of depreciation. Management has decided that assets purchased during a month are treated as if purchased on the first day of the month. The buildings scrap value is $8500. The office equipment has a scrap value of $350. The computer equipment has no scrap value. Calculate depreciation for one month.