Use the following to answer questions 1-4 T&J Company purchased land as a factory site. An old building on the property was demolished, and construction began on a new building. Costs incurred during the first year are listed below: Land purchased as a factory site $600,000 Building construction costs 2,150,000 Interest cost related to the construction 65,000 Demolition of old building 40,000 Title investigation of land 7,000 Property taxes on land (past due for last year) 9,000 Property taxes on land (for the next year) 9,500 Architect fees (for new building) 62,000 Sale of salvaged materials 4,000 1. $ account? How much of the "property taxes on the land for the next year should be capitalized in the Land 2. How should the sale of salvaged materials be recorded? A. As an added cost of the land B. As a reduction of the cost of the land C. As an added cost to the building D. As a reduction of the cost of the building 3.$_ What amount should be recorded to the Land account? 4. $ What amount should be recorded to the Building account? Use the following to answer questions 5-15 (Straight Line, 180% declining balance and Activity Based) T Transport purchased a new semi-trailer truck for an acquisition cost of $250,000. The company estimates the truck will have a residual value of $50,000 when they are done using it at the end of 4 years or about 500,000 miles. Answer 5-8 based on Straight line depreciation 5.$__ 6. $__ Year 2 depreciation expense Book value at the end of year 2 Accumulated depreciation for year 3 Book value at the end of year 3 7.$__ 8. $ Answer 9-13 based on 180% Declining Balance 9.$. 10. 11. $ 12. $ 13.$_ Year 2 depreciation expense Accumulated depreciation for year 2 _Book value at the end of year 2 Year 3 depreciation expense Year 4 depreciation expense Answer 14 and 15 based on Activity based T Transport used the truck as follows: Year Activity (miles) 1 140,000 2 120,000 110,000 4 130,000 3 14. Under activity based depreciation; what is the amount of depreciation expense they would have recorded for year 3? $_ 15. Under activity based depreciation; what is the book value at the end of year 3? $_ 16. $. During the first two years, SON, Inc., drove the truck 100,000 and 110,000 miles, respectively, to deliver merchandise to its customers. The company originally purchased the truck for $150,000. If the truck has an estimated life of 4 years or 400,000 miles, with an estimated residual value of $50,000, what amount of depreciation expense should SON record in the second year using the activity-based method? 17. $ JMM Corporation purchased equipment at the beginning of Year 1 for $300,000. In Years 1 4,JMM depreciated the asset on a straight-line basis with an estimated useful life of 10 years and a $10,000 residual value. What is the BOOK VALUE of the equipment at the beginning of Year 57 Use the following to answer questions 1-4 T&J Company purchased land as a factory site. An old building on the property was demolished, and construction began on a new building. Costs incurred during the first year are listed below: Land purchased as a factory site $600,000 Building construction costs 2,150,000 Interest cost related to the construction 65,000 Demolition of old building 40,000 Title investigation of land 7,000 Property taxes on land (past due for last year) 9,000 Property taxes on land (for the next year) 9,500 Architect fees (for new building) 62,000 Sale of salvaged materials 4,000 1. $ account? How much of the "property taxes on the land for the next year should be capitalized in the Land 2. How should the sale of salvaged materials be recorded? A. As an added cost of the land B. As a reduction of the cost of the land C. As an added cost to the building D. As a reduction of the cost of the building 3.$_ What amount should be recorded to the Land account? 4. $ What amount should be recorded to the Building account? Use the following to answer questions 5-15 (Straight Line, 180% declining balance and Activity Based) T Transport purchased a new semi-trailer truck for an acquisition cost of $250,000. The company estimates the truck will have a residual value of $50,000 when they are done using it at the end of 4 years or about 500,000 miles. Answer 5-8 based on Straight line depreciation 5.$__ 6. $__ Year 2 depreciation expense Book value at the end of year 2 Accumulated depreciation for year 3 Book value at the end of year 3 7.$__ 8. $ Answer 9-13 based on 180% Declining Balance 9.$. 10. 11. $ 12. $ 13.$_ Year 2 depreciation expense Accumulated depreciation for year 2 _Book value at the end of year 2 Year 3 depreciation expense Year 4 depreciation expense Answer 14 and 15 based on Activity based T Transport used the truck as follows: Year Activity (miles) 1 140,000 2 120,000 110,000 4 130,000 3 14. Under activity based depreciation; what is the amount of depreciation expense they would have recorded for year 3? $_ 15. Under activity based depreciation; what is the book value at the end of year 3? $_ 16. $. During the first two years, SON, Inc., drove the truck 100,000 and 110,000 miles, respectively, to deliver merchandise to its customers. The company originally purchased the truck for $150,000. If the truck has an estimated life of 4 years or 400,000 miles, with an estimated residual value of $50,000, what amount of depreciation expense should SON record in the second year using the activity-based method? 17. $ JMM Corporation purchased equipment at the beginning of Year 1 for $300,000. In Years 1 4,JMM depreciated the asset on a straight-line basis with an estimated useful life of 10 years and a $10,000 residual value. What is the BOOK VALUE of the equipment at the beginning of Year 57