Hello,

Can you please help with this question and give an explanation for the correct answer? Thank you.

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	$	168,000			$
Buildings		1,150,000				321,900
Equipment		775,000				310,500
Automobiles and trucks		165,000				93,325
Leasehold improvements		202,000				101,000
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 18,000 shares of Cord's common stock. On this date, Cord's stock had a fair value of $40 a share. Current assessed values of land and building for property tax purposes are $136,000 and $544,000, respectively.
2. On March 25, 2021, new parking lots, streets, and sidewalks at the acquired plant facility were completed at a total cost of $150,000. 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 $318,000. Additional costs of $12,000 for delivery and $43,000 for installation were incurred.
5. On September 30, 2021, Cord purchased a new automobile for $11,800.
6. On September 30, 2021, a truck with a cost of $23,300 and a book value of $7,800 on date of sale was sold for $10,800. Depreciation for the nine months ended September 30, 2021, was $1,755.
7. On December 20, 2021, equipment with a cost of $13,500 and a book value of $2,800 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.

THOMPSON CORPORATION Fixed Asset and Depreciation Schedule For Fiscal Years Ended September 30, 2020, and September 30, 2021 Depreciation for Year Ended 9/30 Depreciation Method Acquisition Date Estimated Life in Years Residual Assets Cost 2020 2021 Land A N/A N/A 10/1/2019 not applicable N/A N/A 61,650 Straight-line Building A 10/1/2019 $ 14,400 not applicable Land B N/A 10/2/2019 N/A N/A N/A Building B Donated Equipment Equipment A Equipment B Under construction 250,000 to date Straight-line 30 200% Declining balance Sum-of-the years-digits 10/2/2019 2,400 10 10/2/2019 4.800 10 10/1/2020 Straight-line 15 THOMPSON CORPORATION Fixed Asset and Depreciation Schedule For Fiscal Years Ended September 30, 2020, and September 30, 2021 Depreciation for Year Ended 9/30 Depreciation Method Acquisition Date Estimated Life in Years Residual Assets Cost 2020 2021 Land A N/A N/A 10/1/2019 not applicable N/A N/A 61,650 Straight-line Building A 10/1/2019 $ 14,400 not applicable Land B N/A 10/2/2019 N/A N/A N/A Building B Donated Equipment Equipment A Equipment B Under construction 250,000 to date Straight-line 30 200% Declining balance Sum-of-the years-digits 10/2/2019 2,400 10 10/2/2019 4.800 10 10/1/2020 Straight-line 15