On December 31, 2013, the Mallory Corporation had the following activity in its fixed assets record. Assume all assets were purchased on January 1.

Equipment Cost Salvage Date Life Method of Depreciation

Machine 1 $65,000 $5,000 2012 5 DDB

Building #3 $900,000not including land $50,000 2004 25 S/L

Mine 316 $1,000,000 $0 2010 1,000,000 tons 30,000 tons extracted

Mine 682 $500,000 $100,000 2011 40,000 barrels 6,000 barrels extracted

Patent $50,000 $0 2010 17

Truck 1 $35,000 $3,000 2010 200,000 miles Units of production: total miles depreciated to date are 60,000 as of January 1, 2006. Miles this year 30,000

Truck 2 $50,000 $5,000 2009 150,000 miles Units of production, miles this year are 15,000

Truck 3 $75,000 $10,000 2008 200,000 miles Units of production: total miles depreciated to date are 180,000 as of January 1, 2006. Miles in 2006 are 30,000 miles.

Machine 2 $100,000 $5,000 2003 10 S/L

REQUIRED:

Compute the depletion, amortization, and depreciation expense on December 31, 2013 for each asset listed above.

Record the entries for the assets above

Suppose that we sold machine 2 for $50,000, record the entry

Suppose that the building life increased from 25 years to 30 years, revise the depreciation and prepare the entry.

Suppose that the corporation spent $20,000 in 2013 to defend the patent. Record the entry.