Required information

[The following information applies to the questions displayed below.] Timberly Construction makes a lump-sum purchase of several assets on January 1 at a total cash price of $820,000. The estimated market values of the purchased assets are building, $467,950; land, $296,050; land improvements, $76,400; and four vehicles, $114,600.

Required: 1-a. Allocate the lump-sum purchase price to the separate assets purchased. 1-b. Prepare the journal entry to record the purchase. 2. Compute the first-year depreciation expense on the building using the straight-line method, assuming a 15-year life and a $31,000 salvage value. 3. Compute the first-year depreciation expense on the land improvements assuming a five-year life and double-declining-balance depreciation.

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

• Required 1A
• Required 1B
• Required 2
• Required 3

Allocate the lump-sum purchase price to the separate assets purchased.

Allocation of total cost	Appraised Value	Percent of Total Appraised Value		x	Total cost of Acquisition	Apportioned Cost
Building			%	x
Land			%	x
Land improvements			%	x
Vehicles			%	x
Total			%

Journal entry worksheet

• Record the costs of lump-sum purchase.

Note: Enter debits before credits.

Date	General Journal	Debit	Credit
Jan 01

Compute the first-year depreciation expense on the building using the straight-line method, assuming a 15-year life and a $31,000 salvage value. (Round your answer to the nearest whole dollar.)

Depreciation expense on building

Compute the first-year depreciation expense on the land improvements assuming a five-year life and double-declining-balance depreciation.

Depreciation expense on land improvements