$!$

Required information

CP$9-3($Algo$)$ Analyzing and Recording Long$-$Lived Asset Transactions with Partial$-$Year Depreciation $[$LO $9-2,$ LO $9-3,$ LO $9-6]$

$[$The following information applies to the questions displayed below.$]$

Palmer Cook Music Productions manages and operates two bands. The company entered into the following transactions during a recent year.

January $2$ Purchased a tour bus for $$104,000$ by paying $$38,000$ cash and signing a $$66,000$ note due in two years. In its accounting system, the company records the vehicle distinct from other types of equipment.

January $8$ After the bus was used for nearly one week, it was painted with the logos of the two bands at a cost of $$550,$ on account. The logos did not increase the lifespan, operating capacity, or operating efficiency of the bus, but they were thought to be useful in promoting the bands.

January $30$ Wrote a check for the amount owed on account for the work completed on January $8.$

February $1$ Purchased new speakers and amplifiers and wrote a check for the full $$39,000$ cost$.$

February $8$ Paid $$450$ cash for minor repairs to the tour bus.

March $1$ Paid $$38,000$ cash and signed a $$280,000$ five$-$year note to purchase a small office building and land. An appraisal indicated that the building and land contributed equally to the total price.

March $31$ Paid $$97,000$ cash to acquire the goodwill and certain tangible assets of Kris' Myth$,$ Incorporated. The fair values of the tangible assets acquired were $$23,000$ for band equipment and $$61,000$ for recording equipment.

CP$9-3($Algo$)$ Part $1-$b to $3$

$1-$b$.$ Prepare the journal entries for each of the above transactions.

$2.$ For the tangible and intangible assets acquired in the preceding transactions, determine the amount of depreciation and amortization that Palmer Cook Music Productions should report for the quarter ended March $31.$ For convenience, the equipment and vehicle are depreciated the same way, using the straight$-$line method with a useful life of five years and no residual value. The building is depreciated using the double$-$declining$-$balance method, with a $10-$year useful life and residual value of $$38,000.$ TIP:

Calculate depreciation from the acquisition date to the end of the quarter.

$3.$ Prepare a journal entry to record the depreciation calculated in requirement $2.$

Complete this question by entering your answers in the tabs below.