Compute depreciation of the building at the end of year one

Assignment Help Financial Accounting
Reference no: EM132678757

Kirby Corporation bought a building and the land on which it is situated for a total cash price of $429,000. The company paid transfer costs to the lawyer of $5,000. Renovations done to the building totaled $52,000. The land and building were independently appraised at market values of $150,000 and $350,000 before the renovation respectively.

Required:

Problem a) Allocate the cost of the property on the basis of the appraised values. Ensure you show your calculations.

Problem b) Prepare the journal entry to record the purchase of the building and land, including all expenditures. Assume that half the transaction was for cash and the other half for a short-term note payable. All purchases occurred at the start of the fiscal year.

Problem c) Compute depreciation of the building at the end of year one, using the straight-line method. Assume an estimated useful life of 10 years and an estimated residual value of $32,000.

Problem d) What would be the carrying value of the property (building and land) at the end of year 3?

Reference no: EM132678757

Questions Cloud

About the structure of the republican party : Review the lecture about the structure of the Republican Party in Virginia as an example.
Calculate the best-case and worst-case npv figures : Suppose the projections given for price, quantity, variable costs, and fixed costs are all accurate to within ±10 percent. Calculate the best-case and worst-cas
How professional nurses can become involved in policy-making : In the Module 4 Discussion, you considered how professional nurses can become involved in policy-making. Review the Resources and reflect on the role.
Product strategy-pricing and distribution : Marketing information is critical throughout the product life cycle. The marketing function also plays an essential role in determining pricing
Compute depreciation of the building at the end of year one : Compute depreciation of the building at the end of year one, using the straight-line method. Assume an estimated useful life of 10 years
Post an explanation of your choice of a nursing specialty : Post an explanation of your choice of a nursing specialty within the program. Describe any difficulties you had (or are having) in making your choice.
Which type of fund should it recognize the revenue : A not-for-profit organization receives a restricted gift. When and in which type of fund should it recognize the revenue?
Make reconciliation from the opening balances : Make reconciliation from the opening balances to the ending balances of the defined benefit obligation and plan assets for the year ended December 31, 20X6.
What is the beta of the stock : The standard deviation of the market is 11.9%. What is the beta of the stock?

Reviews

Write a Review

Financial Accounting Questions & Answers

  Financial statement analysis and preparation

Financial Statement Analysis and Preparation

  Shareholder of a company

Describe the ways that a person can become a shareholder of a company. Why Wal-Mart would split its stock?

  Financial and accounting principles

An understanding of financial and accounting principles can be a valuable tool for managers. While not all managers will find themselves calculating financial ratios or preparing annual financial data.

  Prepare a statement of cash flow using the direct method

Prepare a Statement of Cash Flow using the Direct Method and Prepare the Operations section of the Statement of Cash Flow using the Indirect Method.

  Financial accounting assignment

This assignment has one case study and two question apart from case study. Questions related to document Liquidation question and Company financial statements question - Torquay Limited

  Prepare general journal entries for goela

Prepare general journal entries for Goela Ltd

  Principles of financial accounting

Prepare the journal entry to record the acquisition of the assets.

  Prepare general journal entries to record the transactions

Prepare general journal entries to record the transactions, assuming use of the periodic inventory system

  Global reporting initiative

Compare the view espoused by the economist Milton Friedman about the social responsibilities of business with the views express by Stigler.

  Explain the iasb conceptual frameworks

Explain the IASB Conceptual Framework's perspective of users and their decisions.

  Determine the company''s financial statements

T he focus of the report is to determine the extent to which you are comfortable relying on the financial statements as presented by management .

  Computation of free cash flow

Computation of Free Cash Flow

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd