Chapter 8: Accounting for Long-Term Operational Assets Basket Purchase Allocation, Depreciation, Gain Loss on Sale. Bishop Enterprises purchased land, a building, and some equipment on January 1, 2018 for $400,000. An appraiser valued the land at $50,000, the building at $350,000, and the equipment at $100,000. The building has a useful life of 20 years and the company expects the residual value to be $30,000. The equipment has a useful life of 5 years with an expected residual value of $10,000. The building is depreciated using straight-line and the equipment is depreciated using double-declining balance 11. Prepare the journal entry to record the purchase. 12. Calculate and record the journal entries for depreciation expense for the first three years. 13. Next assume the land, building, and equipment were all sold on December 15, 2021 for $350,000. Calculate the gain or loss and record the journal entry for the sale. 14. Instead, now assume the equipment was sold for $25,000 and Bishop kept the land and building. Calculate the gain or loss and record the journal entry for the sale