Ch 16. A company purchases land and a building on the land for a total of $1,000

Question

Ch 16. A company purchases land and a building on the land for a total of $1,000,000. The fair market values of the land and building are $300,000 and $900,000, respectively. the land and building should be recorded at $500,000 each. a. b. $300,000 and $900,000, respectively. .$250,000 and $750,000, respectively d. $600,000 each. e. $333,333 and $666,667, respectively. An asset that costs $7,000 and has accumulated depreciatiot The ensuing journal entry would include a ulated depreciation of $5,20s sol for $1,000 17. a. credit to Loss on Sale of Asset for $800. debit to Accumulated Depreciation for $5,200. credit to the asset account for $1,800. redit to Gain on Sale of Asset for $1,000. b. C. d. a e. debit to Loss on Sale of Asset for $4,200. tions18-20 nurchased equipment for $60,000. The company ings, with an estimated residual val 111900,000,year 2)

Explanation / Answer

1) A company purchases land and building on the land for a total of $1,000,000. The fair market values of land and building are $300,000 and $900,000 respectively. The land and building should be recorded at

Solution: $250,000 and $750,000, respectively

Explanation: Assets are recorded at their original purchase price

2) An asset that costs $7,000 and has accumulated depreciation of $5,200 and is sold for $1,000. The ensuing joirnal entry would include a

Solution: Debit to Loss on Sale of Asset for $800.

Working: Loss on sale = 7000 - 5200 - 1000 = 800

Related Questions

Navigate

• Browse (All)
• Browse C
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.