Question
The Thompson Corporation, a manufacturer of steel products, began operations on October 1, 2011. The accounting department of Thompson has started the fixed-asset and depreciation
The Thompson Corporation, a manufacturer of steel products, began operations on October 1, 2011. The accounting department of Thompson has started the fixed-asset and depreciation schedule presented below. You have been asked to assist in completing this schedule. In addition to ascertaining that the data already on the schedule are correct, you have obtained the following information from the company's records and personnel (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 andPVAD of $1) (Use appropriate factor(s) from the tables provided.): |
a. | Depreciation is computed from the first of the month of acquisition to the first of the month of disposition. |
b. | Land A and Building A were acquired from a predecessor corporation. Thompson paid $802,500 for the land and building together. At the time of acquisition, the land had a fair value of $106,800 and the building had a fair value of $783,200. |
c. | Land B was acquired on October 2, 2011, in exchange for 2,900 newly issued shares of Thompson |
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