Crow Company purchased some of the machinery of Hare Incorporated, a bankrupt competitor, at a liquidation sale for a total cost of $136,200. Crow's cost of moving and installing the machinery totaled $12,300. The following data are available Hare's Net Book Value List Price of Same Appraiser's Estimate Item Punch press Lathe Welder on the Date of Sale Item If New of Fair Value $ 85,400 58,200 26,400 $ 131,000 67,000 42,000 $ 108,000 45,000 27,000 Required: a. Calculate the amount that should be recorded by Crow Company as the cost of each piece of equipment. b. Which of the following alternatives should be used as the depreciable life for Crow Company's depreciation calculation?

Crow Company purchased some of the machinery of Hare Incorporated, a bankrupt competitor, at a liquidation sale for a total cost of $136,200. Crow's cost of moving and installing the machinery totaled $12,300. The following data are available Hare's Net Book Value List Price of Same Appraiser's Estimate Item Punch press Lathe Welder on the Date of Sale Item If New of Fair Value $ 85,400 58,200 26,400 $ 131,000 67,000 42,000 $ 108,000 45,000 27,000 Required: a. Calculate the amount that should be recorded by Crow Company as the cost of each piece of equipment. b. Which of the following alternatives should be used as the depreciable life for Crow Company's depreciation calculation?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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