[The following Information applies to the questions displayed below.]On January 1, Mitzu Company pays a lump-sum amount of $2,650,000 for land, Building 1, Building 2, and LandImprovements 1. Building 1 has no value and will be demolished. Building 2 will be an office and is appraised at $660,000,with a useful life of 20 years and a $80,000 salvage value. Land Improvements 1 is valued at $600,000 and is expected tolast another 20 years with no salvage value. The land is valued at $1,740,000. The company also incurs the followingadditional costs.Cost to demolish Building 1Cost of additional land gradingCost to construct Building 3, having a useful life of 25 years and a $402,000 salvage valueCost of new Land Improvements 2, having a 20-year useful life and no salvage valueRequired:1. Allocate the costs incurred by Mitzu to the appropriate columns and total each column.Allocation of Purchase PriceLandBuilding 2Land Improvements 1TotalsPurchase PriceDemolitionLand gradingNew building (Construction cost)New improvementsTotalsView transaction listDateJanuary 01AppraisedValueRecord entrySNote: Enter debits before credits.$Journal entry worksheet< 1DateLandDecember 31Record entry0Record the cost of the plant assets, paid in cash.Percent ofTotalAppraisedValue0 $Note: Enter debits before credits.Building 2General JournalClear entry0%2. Prepare a single journal entry to record all the incurred costs assuming they are paid in cash on January 1.00General JournalClear entry000Total cost ofacquisitionBuilding 3DebitSRecord the year-end adjusting entry for the depreciation expense of Building3.0 SCreditLandImprovements 1Apportioned CostView general journalDebit0 SLandImprovements 2CreditView general journal$ 343,400195,4002,302,000173,00000 Journal entry worksheet< 1 2Record the year-end adjusting entry for the depreciation expense of LandImprovements 1.Note: Enter debits before credits.DateDecember 31Record entryView transaction list3Journal entry worksheet< 1 23Note: Enter debits before credits.DateDecember 31Record entry43. Using the straight-line method, prepare the December 31 adjusting entries to record depreciation for the first year these assets werein use.4General JournalRecord the year-end adjusting entry for the depreciation expense of LandImprovements 2.Clear entryGeneral JournalClear entryDebitDebitCreditView general journalCreditView general journal>>

The lump sum price paid to acquire various assets can be apportioned on the basis of their fair…

[The following Information applies to the questions displayed below.] On January 1, Mitzu Company pays a lump-sum amount of $2,650,000 for land, Building 1, Building 2, and Land Improvements 1. Building 1 has no value and will be demolished. Building 2 will be an office and is appraised at $660,000, with a useful life of 20 years and a $80,000 salvage value. Land Improvements 1 is valued at $600,000 and is expected to last another 20 years with no salvage value. The land is valued at $1,740,000. The company also incurs the following additional costs. Cost to demolish Building 1 Cost of additional land grading Cost to construct Building 3, having a useful life of 25 years and a $402, 000 salvage value Cost of new Land Improvements 2, having a 20-year useful life and no salvage value uired: $ 343,400 195,400 2,302,000 173,000

[The following Information applies to the questions displayed below.] On January 1, Mitzu Company pays a lump-sum amount of $2,650,000 for land, Building 1, Building 2, and Land Improvements 1. Building 1 has no value and will be demolished. Building 2 will be an office and is appraised at $660,000, with a useful life of 20 years and a $80,000 salvage value. Land Improvements 1 is valued at $600,000 and is expected to last another 20 years with no salvage value. The land is valued at $1,740,000. The company also incurs the following additional costs. Cost to demolish Building 1 Cost of additional land grading Cost to construct Building 3, having a useful life of 25 years and a $402, 000 salvage value Cost of new Land Improvements 2, having a 20-year useful life and no salvage value uired: $ 343,400 195,400 2,302,000 173,000

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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Salem Amusement Park paid $400,000 for a concession stand. Salem started out depreciating the building using the straight-line method over 20 years with a residual value of zero. After using the concession stand for four years, Salem determines that the building will remain useful for only four more years. Record Salem's depreciation on the concession stand for year five using the straight-line method. (Record debits first, then credits. Exclude explanations from any journal entries.) Date Journal Entry Accounts Debit Credit
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4. On January 1, Mitzu Company pays a lump-sum amount of $2,600,000 for land, Building 1, Building 2, and Land Improvements 1. Building 1 has no value and will be demolished. Building 2 will be an office and is appraised at $793,000, with a useful life of 20 years and a $70,000 salvage value. Land Improvements 1 is valued at $305,000 and is expected to last another 10 years with no salvage value. The land is valued at $1,952,000. The company also incurs the following additional costs. Cost to demolish Building 1 $ 348,400 Cost of additional land grading 187,400 Cost to construct Building 3, having a useful life of 25 years and a $400,000 salvage value 2,202,000 Cost of new Land Improvements 2, having a 20-year useful life and no salvage value 178,000 Required:1. Allocate the costs incurred by Mitzu to the appropriate columns and total each column.
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On January 1, Mitzu Co. pays a lump-sum amount of $2,650,000 for land, Building 1, Building 2, and Land Improvements 1. Building 1 has no value and will be demolished. Building 2 will be an office and is appraised at $540,000, with a useful life of 20 years and a $80,000 salvage value. Land Improvements 1 is valued at $600,000 and is expected to last another 20 years with no salvage value. The land is valued at $1,860,000. The company also incurs the following additional costs. Cost to demolish Building 1 Cost of additional land grading Cost to construct Building 3, having a useful life of 25 years and a $402,000 salvage value Cost of new Land Improvements 2 having a 20-year useful life and no salvage value View transaction list Journal entry worksheet 2. Prepare a single journal entry to record all the incurred costs assuming they are paid in cash on January 1 < Record the cost of the plant assets, paid in cash. Note: Enter debits before credits. Date Jan 01 General Journal $ 343,400…
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