Asset Allocation, Financial Accounting

Assignment Help:
In January 2013, Mitzu Co. pays $2,600,000 for a tract of land with two buildings on it. It plans to demolish Building I and build a new store in its place. Building 2 will be a company office; it is appraised at $644,000 with a useful life of 20 years and an $60,000 salvage value. A lighted parking lot near Building 1 has improvements (Land improvements 1) valued at $420,000 that are expected to last another 12 years with no salvage value. Without the building and improvements, the tract of land is valued at $1,736,000.
The company will also incur the following additional costs:
- Cost to demolish Building 1 $328,400
- Cost of additional land grading $175,400
- Cost to construct new building (Building 3), having a useful life of 25 years and a $392,000 salvage value…$2,202,000
- Cost of new land improvements (Land improvements 2) near Building 2 having a 20 year useful life and no salvage value…$164,000
Required:
1. Prepare a table with the following column headings: Land, Building 2, Building 3, Land Improvements 1, and Land Improvements 2. Allocate the costs incurred by Mitzuto the appropriate columns and total each column (round percents to the nearest 1 %)
2. Prepare a single journal entry to record all the incurred costs assuming they are paid in cash on January 1, 2013
3. Using the straight line method, prepare the December 31 adjusting entries to record depreciation for the 12 months of 2013 when these assets were

Related Discussions:- Asset Allocation

Bonds, How to prepare a bond amortization sheet

How to prepare a bond amortization sheet

Describe how it is helpful for management decision makings, Question: (...

Question: (a) Describe how cost concepts and behavior can be important to Management. (b) What do you meant by "flexing" the Budget? Describe the importance of flexible bud

Annual coupon payment, Arnot International's bonds have a present market pr...

Arnot International's bonds have a present market price of $1,250. The bonds have an 11% annual coupon payment, a $1,000 face value, and 10 years left until maturity. The bonds may

Google, how do i find info about google inc

how do i find info about google inc

Compositions and schemes of arrangement, COMPOSITIONS AND SCHEMES OF ARRANG...

COMPOSITIONS AND SCHEMES OF ARRANGEMENT The debtor may lodge a written proposal with the Official Receiver for a composition or other arrangement of his affairs within four day

Calculate return on invested capital, Five years ago Ramon Millan quit his ...

Five years ago Ramon Millan quit his job as an associate at a large law firm and opened a burger joint in Malibu. His innovative use of aged blue cheeses and specialty sauces resul

Calculate the present value, Compute the present value of Rs. 1000 receivab...

Compute the present value of Rs. 1000 receivable 6 years thus if the discount rate is 10 percent. Solution: The present value is computed as follows: PV kn = FV n . PVIF k,n

Show example on ratio calculations, Q. Show example on Ratio calculations? ...

Q. Show example on Ratio calculations? The current gearing of Springbank plc = 100 × (3·5m/4m) = 87·5% Total debt after issuing $3·4m of debt = 3·5m + 3·4m = $6·9m New le

benefit-cost ratio, The city of Fredericton operates automobile parking fa...

The city of Fredericton operates automobile parking facilities and is evaluating a proposal to erect and operate a structure for parking in the city's downtown area. 2 designs for

What net carrying amount, On June 30, 2011, Omara Co. had outstanding 8%, $...

On June 30, 2011, Omara Co. had outstanding 8%, $3,000,000 face amount, 15-year bonds maturing on June 30, 2021. Interest is payable on June 30 and December 31. The unamortized bal

Write Your Message!

Captcha
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