FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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![nequieu nouv
[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 $850,000. The
estimated market values of the purchased assets are building, $490,000; land, $290,000; land improvements, $50,000;
and four vehicles, $170,000.
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 $28,000
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 18 Required 2 Required 3
Allocate the lump-sum purchase price to the separate assets purchased.
Allocation of total
cost
Total cost of
Acquisition
Estimated
Market Value
Percent of Total
Apportioned
Cost](https://content.bartleby.com/qna-images/question/4be9481d-42db-49d0-9351-cb00829908ba/af1f297b-0d3b-458c-ad51-a9b9770f2303/odjgd6_processed.jpeg)
Transcribed Image Text:nequieu nouv
[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 $850,000. The
estimated market values of the purchased assets are building, $490,000; land, $290,000; land improvements, $50,000;
and four vehicles, $170,000.
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 $28,000
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 18 Required 2 Required 3
Allocate the lump-sum purchase price to the separate assets purchased.
Allocation of total
cost
Total cost of
Acquisition
Estimated
Market Value
Percent of Total
Apportioned
Cost
Transcribed Image Text:Complete this question by entering your answers in the tabs below.
Required 1A Required 1B
Allocation of total
cost
Allocate the lump-sum purchase price to the separate assets purchased.
Building
Land
Land improvements
Vehicles
Total
January 01
Date
General Journal
Required 2
Show Transcribed Text
Debit Credit
Estimated
Market Value
$ 490,300
$ 490,300
Note: Enter debits before credits.
Record the costs of lump-sum purchase.
Required 3
Show Transcribed Text
Percent of Total
55 %
%
%
%
55 %
Required 3
Journal entry worksheet
X
X
< Required 1A
x
X
< Required 18
Total cost of
Acquisition
View transaction list
Complete this question by entering your answers in the tabs below.
Prepare the journal entry to record the purchase.
Apportioned
Cost
$ 445,500
$
Required 18 >
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 $28,000
salvage value.
3. Compute the first-year depreciation expense on the land improvements assuming a five-year life and double-declining-balance
depreciation.
Required 1A Required 1B Required 2
445,500
Required 3
Required 1A Required 18 Required 2
Compute the first-year depreciation expense on the building using the straight-line method, assuming a 15-year life and a
$28,000 salvage value. (Round your answer to the nearest whole dollar.)
Depreciation expense on building
Required 3 >
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