Calculate the carrying amounts of the assets at december

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obbins Inc. purchased the following assets of Marine Company for $500,000 cash on September 30, 2018: Land $300,000 Building 100,000 Computer software 75,000 366 CHAPTER EIGHT / Long-lived Assets First US Edition The building will be depreciated using the straight-line method. It has an estimated useful life of forty years and a salvage value of 10% of cost. The computer software has an estimated useful life of three years and no salvage value. It will be amortized using the double-declining balance method. On January 2, 2019, the value of the computer software was estimated at $50,000. The computer software was sold on September 15, 2020 for $65,000. Robbins Inc. uses the ½ year rule to calculate depreciation and amortization expense in the year of acquisition and disposal. Its fiscal year-end is December 31.

Required:

Problem 1. Prepare journal entries to record a. the $500,000 purchase b. depreciation and amortization expense for 2018 c. the change in the value of the computer software at January 2, 2019 d. the sale of the computer software on September 15, 2020.

Problem 2. Calculate the carrying amounts of the assets at December 31, 2020

Reference no: EM132994726

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