WEEK FIVE

Timberly Construction negotiates a lump-sum purchase of several assets from a company that is going out of business. The purchase is completed on January 1, 2015, at a total cash price of $810,000 for a building, land, land improvements, and four vehicles. The estimated market values of the assets are building, $458,250; land, $312,000; land improvements, $58,500; and four vehicles, $146,250. The companys fiscal year ends on December 31.

Required:

1.1

Prepare a table to 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	$458,250		x	$810,000
Land	312,000		x	$810,000
Land improvements	58,500		x	$810,000
Vehicles	146,250		x	$810,000
Total	$975,000	0%			$0

2. Compute the depreciation expense for year 2015 on the building using the straight-line method, assuming a 15-year life and a $29,000 salvage value. (Round your answers to the nearest whole dollar.)

Depreciation expense on building

3.Compute the depreciation expense for year 2015 on the land improvements assuming a five-year life and double-declining-balance depreciation.

Depreciation expense on land improvements

PLEASE ANSWER EACH QUESTION CORRECTLY AND FILL IN EACH BLANK!!