in November 4, 2019, Blue Company acquired an asset (27.5-year residential real property) for $200,000 for use in its business. In 2019 nd 2020, respectively, Blue deducted $642 and $5,128 of cost recovery. These amounts were incorrect; Blue applied the wrong ercentages (i.c., those for 39-year rather than 27.5 year assets). Blue should have taken $910 and $7,272 cost recovery in 2019 and 020, respectively. On January 1, 2021, the asset was sold for $180,000. I required, round all computations to the nearest dollar. lick here to access the depreciation tables in the textbook. The adjusted basis of the asset at the end of 2020 is $ The cost recovery deduction for 2021 is s -The loss ✓on the sale of the asset in 2021 is s

in November 4, 2019, Blue Company acquired an asset (27.5-year residential real property) for $200,000 for use in its business. In 2019 nd 2020, respectively, Blue deducted $642 and $5,128 of cost recovery. These amounts were incorrect; Blue applied the wrong ercentages (i.c., those for 39-year rather than 27.5 year assets). Blue should have taken $910 and $7,272 cost recovery in 2019 and 020, respectively. On January 1, 2021, the asset was sold for $180,000. I required, round all computations to the nearest dollar. lick here to access the depreciation tables in the textbook. The adjusted basis of the asset at the end of 2020 is $ The cost recovery deduction for 2021 is s -The loss ✓on the sale of the asset in 2021 is s

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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On March 31, 2024, Susquehanna Insurance purchased an office building for $12,000,000. Based on their relative fair values, one-third of the purchase price was allocated to the land and two-thirds to the building. Furniture and fixtures were purchased separately from office equipment on the same date for $1,360,000 and $860,000, respectively. The company uses the straight-line method to depreciate its buildings and the double-declining-balance method to depreciate all other depreciable assets. The estimated useful lives and residual values of these assets are as follows: Service Life Residual Value Building 30 10% of cost Furniture and fixtures 20 10% of cost Office equipment 10 $ 46,000 Required: Calculate depreciation for the years ended December 31, 2024 and 2025. What book values would be reported in the December 31, 2025, balance sheet (including land)?
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