D Bridge City bought a building and land on which it is located for $182,000 cash. The land is estimated to represent 70% of the purchase price. The company paid $22,000 for building renovations before it was ready for use. 1. Explain how the renovation costs are to be accounted for (capitalized or expensed?). 2. Give the journal entry to record all expenditures. Assume that all transactions were for cash and they occurred at the start of the year. 1-Jan Land Building Cash Building E Cash 3. Compute straight line depreciation on the building at the end of one year, assuming an estimated 12 year useful life and a 4600 estimated residual value.

D Bridge City bought a building and land on which it is located for $182,000 cash. The land is estimated to represent 70% of the purchase price. The company paid $22,000 for building renovations before it was ready for use. 1. Explain how the renovation costs are to be accounted for (capitalized or expensed?). 2. Give the journal entry to record all expenditures. Assume that all transactions were for cash and they occurred at the start of the year. 1-Jan Land Building Cash Building E Cash 3. Compute straight line depreciation on the building at the end of one year, assuming an estimated 12 year useful life and a 4600 estimated residual value.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 5Q: For each of the following transactions, state whether the cost would be capitalized (C) or recorded...

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