...oo Verizon LTE 10:48 PM ezto.mheducation.com E connect Nicholas Piloco Chapte

Question

...oo Verizon LTE 10:48 PM ezto.mheducation.com E connect Nicholas Piloco Chapter 9 Assignment The following information applies to the questions displayed below 3.00 point Required: 2 Prepare the journal entry to record all expenditures. Assume that all transactions were for cash and they occurred at the start of the year. (If no entry is required for a transactionievent select "No Journal Entry Required" in the first account field.) Journal entry worksheet were paid for with cash and ocued at the start of the year

Explanation / Answer

1) Transaction Account Head & Description Debit Amount Credit Amount 1 Land (180000*70%) 126000 Building (180000*30%) 54000 Cash 180000 (to record the purchase of land & building) 2 Building 10000 Cash 10000 (to record capitalization of building expenditure) 3) Depreciation under straight-line method = (cost of asset-Salvage value)/Useful life = (54000+10000-10000)/10 = $5400 4) Book value: Land = $126000 Building = $54000+$10000-$5400-$5400 = $53200 Note: The amount of purchase of land and building is not clear. The above solution is solved assuming that the total cost is $180000. If the total costs is $190000 then; 1) Transaction Account Head & Description Debit Amount Credit Amount 1 Land (190000*70%) 133000 Building (190000*30%) 57000 Cash 190000 (to record the purchase of land & building) 2 Building 10000 Cash 10000 (to record capitalization of building expenditure) 3) Depreciation under straight-line method = (cost of asset-Salvage value)/Useful life = (57000+10000-10000)/10 = $5700 4) Book value: Land = $126000 Building = $57000+$10000-$5700-$5700 = $55600

Related Questions

Navigate

• Browse (All)
• Browse #
• Subjects

---

---

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