On January 1, 2019, Lundy acquired a new machinery for $120,000 with an estimated salvage value of $20,000. The machinery has an estimated useful life of eight (8) years. On January 1, 2020, Lundy sold a building for $210,000 cash. The building was acquired several years ago at a cost $250,000; the accumulated depreciation on the building at the date of disposition was $70,000. On May 1, 2020, Lundy Corporation acquired undeveloped land for $2,653,000. Lundy also paid legal costs of $19,050 associated with the acquisition, along with brokers fees of $22,000. In addition, Lundy paid $8,000 in costs of removing an abandoned building, while receiving $1,200 in proceeds from salvage materials.

Part A. The amount of depreciation on the machinery in 2020 is: A. $4,167. B. $12,500. C. $16,667. D. $10,000.

Part B. The entry to record the sale of the building on January 1, 2020 would include: A. A debit to Cash, $250,000. B. A credit to Accumulated Depreciation, $210,000. C. A debit to Gain on Sale, $30,000. D. A credit to Building, $250,000.

Part C. What is the total cost of the land acquired in 2020 to be debited to the Land account? A. $2,700,850. B. $2,702,050. C. $2,563,000. D. $2,703,250