Question
On January 1, Mitzu Co. pays a lump-sum amount of $2,750,000 for land, Building 1, Building 2, and Land Improvements 1. Building 1 has no
On January 1, Mitzu Co. pays a lump-sum amount of $2,750,000 for land, Building 1, Building 2, and Land Improvements 1. Building 1 has no value and will be demolished. Building 2 will be an office and is appraised at $854,000, with a useful life of 20 years and a $80,000 salvage value. Land Improvements 1 is valued at $244,000 and is expected to last another 8 years with no salvage value. The land is valued at $1,952,000. The company also incurs the following additional costs.
( THX SO MUCH IN ADVANCED. need help ASAP )
Cost to demolish Building 1 | $ | 346,400 | |
Cost of additional land grading | 193,400 | ||
Cost to construct Building 3, having a useful life of 25 years and a $402,000 salvage value | 2,262,000 | ||
Cost of new Land Improvements 2 having a 20-year useful life and no salvage value | 173,000 | ||
3. Using the straight-line method, prepare the December 31 adjusting entries to record depreciation for the first year these assets were in use.
1A
1B
1C
1D
Record the year-end adjusting entry for the depreciation expense of Building 2. Note: Enter debits before credits. Date General Journal Debit Credit Dec 31 Record the year-end adjusting entry for the depreciation expense of Building 3. Note: Enter debits before credits. Date General Journal Debit Credit Dec 31 Record the year-end adjusting entry for the depreciation expense of Land Improvements 1. Note: Enter debits before credits. Date General Journal Debit Credit Dec 31 Record the year-end adjusting entry for the depreciation expense of Land Improvements 2. Note: Enter debits before credits. Date General Journal Debit Credit Dec 31Step by Step Solution
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