Page Layout Insert Formulas Home Cut Wrap Text General 12 Calibri Copy S-% BIU Merge & Center Format Painter lipboard Font Alignment Number Fair value of old machinery C35 A F H Brown Company paid cash to purchase the assets of Coffee Company January 1, on follows: 2019. Information is as Total cash paid $2,990,000 Assets acquired: $600,000 $600,000 $500,000 $600,000 Land Building Machinery Patents The building is depreciated using the double-declining balance method. Other information is: Salvage value Estimated useful life in years $60,000 30 The machinery is depreciated using the units-of-production method. Other information is: Salvage value, percentage of cost Estimated total production output in units Actual production in units was as follows: 10% 400,000 2019 40,000 2020 80,000 2021 120,000 The patents are amortized on a straight-line basis. They have no salvage value. Estimated useful life of patents in years 20 On December 31, 2020, the value of the patents was actimatod toho. JnL Entries Required Anno.ooo Copyright Scroll Lock Page Layout Formulas Insert Home X Cut Wrap Text General Calibri 117 Copy S % FMerge & Center BIU Format Painter Number Alignment Font lipboard fFair value of old machinery C35 G E C A 120,000 2021 amortized on a straight-line basis. They have no salvage value. The patents are Estimated useful life of patents in years 20 On December 31, 2020, the value of the patents was estimated to be $900,000 Where applicable, the company uses the % year rule to calculate depreciation and amortization expense in the years of acquisition and disposal. Its fiscal year-end is December 31. The machinery was traded on December 2, 2021 for new machinery. Other information is: Fair value of old machinery $240,000 Trade-in allowance $336,000 List price for new machinery Estimated useful life of new machinery in years $504,000 20 Estimated salvage value of new machinery The new machinery if depreciated using the stright-line method and % year.rule. $15,120 On August 14, 2023, an addition was made. This amount was material. Other relevant information is as follows: Amount of addition, paid in cash $100,000 Number of years of useful life from 2023 (original machinery and addition): 20 Required Scroll Lock nl. Entries Copyright e Page Layout Formulas Insert Home Cut Wrap Text General 12 Calibri Copy e ee Merge & Center BIU Format Painter Nu Alignment Font pboard Fair value of old machinery C35 F F G C 20 machinery and addition): 10% Salvage value, percentage of addition Required: Prepare journal entries to record: 1 The purchase of the assets of Coffee. 2 Depreciation and amortization expense 3 The decline (if any) in value of the patents at December 31, 2020. 4 The trade-in of the old machinery and purchase of the new machinery 5 Depreciation on the new machinery for 2021. 6 Cost of the addition to the machinery on August 14, 2023. 7 Depreciation on the new machinery for 2023. the purchased assets for 2019. on
