Depreciation Classwork/Homework

1. A company purchases a building and land for $500,000. The appraisal attributes a fair market value (FMV) of 250,000 to the land and $350,000 to the building.

a.What is the acquisition cost of the land?

b.What is the acquisition cost of the building?

2. On January 1, 20X1, Apogee Corp. purchases for $101,700 a machine with an estimated useful life of 3 years and a residual value of $4,500. Apogee uses straight-line depreciation. Complete the table below.

	Year-beginning	Depreciation	Accumulated	Year-end
Year	book value	expense	depreciation	book value
20X1
20X2
20X3