Instructions To add to his growing chain of grocery stores, on January 1, 2016, Danny Marks bought a grocery store of a small competitor for $520,000. An appraiser, hired to assess the acquired assets' values, determined that the land, building, and equipment had market values of $200,000, $150,000, and $250,000, respectively. Chart of Accounts Required: ASSETS REVENUE 1. What is the acquisition cost of each asset? Prepare a journal entry to record the acquisition. 111 Cash 411 Sales Revenue 2. Danny plans to depreciate the operating assets on a straight-line basis for 20 years. Determine the amount of depreciation expense for 2016 on these newly acquired assets. You can assume zero residual value for all assets. 121 Accounts Receivable 141 Inventory EXPENSES 3. How would the assets appear on the balance sheet as of December 31, 2016? 152 Prepaid Insurance 500 Cost of Goods Sold Labels and Amount Descriptions 154 Supplies 521 Salaries and Wages Expense 161 Land 532 Utilities Expense Labels 171 Building 533 Insurance Expense Current assets 174 Equipment 534 Rent Expense Current liabilities 179 Accumulated Depreciation 537 Supplies Expense December 31, 2016 541 Depreciation Expense For the Year Ended December 31 LIABILITIES 551 Advertising Expense Long-term assets 211 Accounts Payable 559 Miscellaneous Expenses Amount Descriptions 231 Salaries and Wages Payable 810 Interest Expense Total current assets 235 Notes Payable 910 Income Tax Expense Total current liabilities 261 Income Taxes Payable Total long-term assets EQUITY 311 Capital Stock 2. Danny plans to depreciate the operating assets on a straight-line basis for 20 years. Determine the amount of depreciation expense for 2016 on these 331 Retained Earnings General Journal 1b. Prepare a journal entry with the impact on the financial statements to record the acquisition General Joumal Instructions PAGE 1 GENERAL JOURNAL IMPACT ON FINANCIAL STATEMENTS BALANCE SHEET INCOME STATEMENT DATE ACCOUNT TITLE POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY REVENUE EXPENSES NET INCOME 1 2 5 Questions Additional Instructions Assets Acquisition Cost Land $ Building $ Equipment $ 2. Darvy plans depreciate the operating assets on a straight-line basis for 20 years. Determine the amount of depreciation expense for 2016 on these newly acquired assets. You can assume zero residual value for all assets. Additional Instructions Assets 2016 Depreciation Land $ $ Building Equipment $ Balance Sheet 3. How would the assets appear on the balance sheet as of December 31, 2016? Balance Sheet Instructions Danny Marks Balance Sheet (Partial) (Label) 1 (Label) 2 3 4 5 6 7