tion, a manufacturer of steel products, began operations on October 1, 2024. The accounting department of Kohlbeck has started the fixed-asset and depreciation schedule presented as follows. Kohlbeck Corporation Fixed-Asset and Depreciation Schedule For Fiscal Years Ended September 30, 2025, and September 30, 2026 Depreciation Expense Year Ended September 30 Estimated Assets Acquisition Date Cost Salvage Depreciation Method Life in Years 2025 2026 Land A October 1, 2024 $ (1) N/A* N/A N/A N/A N/A Building A October 1, 2024 (2) $40,000 Straight-line (3) $13,600 (4) Land B October 2, 2024 (5) N/A N/A N/A N/A N/A Building B Under Construction $320,000 Straight-line 30 (6) to date Donated October 2, 2024 (7) 3,000 150% 10 10 (8) (9) Equipment declining- balance Machinery A October 2, 2024 (10) 6,000 Sum-of-the- years-digits Machinery B October 1, 2025 (13) Straight-line 20 20 (11) (12) (14) *N/A Not applicable You have been asked to assist in completing this schedule. In addition to ascertaining that the data already on the schedule are correct, you have obtained the following information from the company's records and personnel. 1. Depreciation is computed from the first of the month of acquisition to the first of the month of disposition. 2. Land A and Building A were acquired from a predecessor corporation. Kohlbeck paid $800,000 for the land and building together. At the time of acquisition, the land had an appraised value of $90,000, and the building had an appraised value of $810,000. 3. Land B was acquired on October 2, 2024, in exchange for 2,500 newly issued shares of Kohlbeck's common stock. At the date of acquisition, the stock had a par value of $5 per share and a fair value of $30 per share. During October 2024, Kohlbeck paid $16,000 to demolish an existing building on this land so it could construct a new building. 4. Construction of Building B on the newly acquired land began on October 1, 2025. By September 30, 2026, Kohlbeck had paid $320,000 of the estimated total construction costs of $450,000. It is esti- mated that the building will be completed and occupied by July 2027. 5. Certain equipment was donated to the corporation by a local university. An independent appraisal of the equipment when donated placed the fair value at $40,000 and the salvage value at $3,000. Mungiame A's total anck of $10 000 imalandera installation of $200 nnd soul samoine and N/A N/A Building A Land B October 1, 2024 (2) $40,000 Straight-line (3) $13,600 (4) October 2, 2024 (5) N/A N/A N/A N/A N/A Building B Under Construction $320,000 to date Straight-line 30 - (6) Donated October 2, 2024 (7) 3,000 150% 10 10 (8) (9) Equipment declining- balance Machinery A October 2, 2024 (10) 6,000 Sum-of-the- 80 years-digits Machinery B October 1, 2025 (13) - Straight-line 20 20 (11) (12) (14) *N/A Not applicable You have been asked to assist in completing this schedule. In addition to ascertaining that the data already on the schedule are correct, you have obtained the following information from the company's records and personnel. 1. Depreciation is computed from the first of the month of acquisition to the first of the month of disposition. 2. Land A and Building A were acquired from a predecessor corporation. Kohlbeck paid $800,000 for the land and building together. At the time of acquisition, the land had an appraised value of $90,000, and the building had an appraised value of $810,000. 3. Land B was acquired on October 2, 2024, in exchange for 2,500 newly issued shares of Kohlbeck's common stock. At the date of acquisition, the stock had a par value of $5 per share and a fair value of $30 per share. During October 2024, Kohlbeck paid $16,000 to demolish an existing building on this land so it could construct a new building. 4. Construction of Building B on the newly acquired land began on October 1, 2025. By September 30, 2026, Kohlbeck had paid $320,000 of the estimated total construction costs of $450,000. It is esti- mated that the building will be completed and occupied by July 2027. 5. Certain equipment was donated to the corporation by a local university. An independent appraisal of the equipment when donated placed the fair value at $40,000 and the salvage value at $3,000. 6. Machinery A's total cost of $182,900 includes installation expense of $600 and normal repairs and maintenance of $14,900. Salvage value is estimated at $6,000. Machinery A was sold on February 1, 2026. 7. On October 1, 2025, Machinery B was acquired with a down payment of $5,740 and the remaining payments to be made in 11 annual installments of $6,000 each beginning October 1, 2025. The pre- vailing interest rate was 8%. The following data were abstracted from present value tables (rounded).

tion, a manufacturer of steel products, began operations on October 1, 2024. The accounting department of Kohlbeck has started the fixed-asset and depreciation schedule presented as follows. Kohlbeck Corporation Fixed-Asset and Depreciation Schedule For Fiscal Years Ended September 30, 2025, and September 30, 2026 Depreciation Expense Year Ended September 30 Estimated Assets Acquisition Date Cost Salvage Depreciation Method Life in Years 2025 2026 Land A October 1, 2024 $ (1) N/A* N/A N/A N/A N/A Building A October 1, 2024 (2) $40,000 Straight-line (3) $13,600 (4) Land B October 2, 2024 (5) N/A N/A N/A N/A N/A Building B Under Construction $320,000 Straight-line 30 (6) to date Donated October 2, 2024 (7) 3,000 150% 10 10 (8) (9) Equipment declining- balance Machinery A October 2, 2024 (10) 6,000 Sum-of-the- years-digits Machinery B October 1, 2025 (13) Straight-line 20 20 (11) (12) (14) N/A Not applicable You have been asked to assist in completing this schedule. In addition to ascertaining that the data already on the schedule are correct, you have obtained the following information from the company's records and personnel. 1. Depreciation is computed from the first of the month of acquisition to the first of the month of disposition. 2. Land A and Building A were acquired from a predecessor corporation. Kohlbeck paid $800,000 for the land and building together. At the time of acquisition, the land had an appraised value of $90,000, and the building had an appraised value of $810,000. 3. Land B was acquired on October 2, 2024, in exchange for 2,500 newly issued shares of Kohlbeck's common stock. At the date of acquisition, the stock had a par value of $5 per share and a fair value of $30 per share. During October 2024, Kohlbeck paid $16,000 to demolish an existing building on this land so it could construct a new building. 4. Construction of Building B on the newly acquired land began on October 1, 2025. By September 30, 2026, Kohlbeck had paid $320,000 of the estimated total construction costs of $450,000. It is esti- mated that the building will be completed and occupied by July 2027. 5. Certain equipment was donated to the corporation by a local university. An independent appraisal of the equipment when donated placed the fair value at $40,000 and the salvage value at $3,000. Mungiame A's total anck of $10 000 imalandera installation of $200 nnd soul samoine and N/A N/A Building A Land B October 1, 2024 (2) $40,000 Straight-line (3) $13,600 (4) October 2, 2024 (5) N/A N/A N/A N/A N/A Building B Under Construction $320,000 to date Straight-line 30 - (6) Donated October 2, 2024 (7) 3,000 150% 10 10 (8) (9) Equipment declining- balance Machinery A October 2, 2024 (10) 6,000 Sum-of-the- 80 years-digits Machinery B October 1, 2025 (13) - Straight-line 20 20 (11) (12) (14) N/A Not applicable You have been asked to assist in completing this schedule. In addition to ascertaining that the data already on the schedule are correct, you have obtained the following information from the company's records and personnel. 1. Depreciation is computed from the first of the month of acquisition to the first of the month of disposition. 2. Land A and Building A were acquired from a predecessor corporation. Kohlbeck paid $800,000 for the land and building together. At the time of acquisition, the land had an appraised value of $90,000, and the building had an appraised value of $810,000. 3. Land B was acquired on October 2, 2024, in exchange for 2,500 newly issued shares of Kohlbeck's common stock. At the date of acquisition, the stock had a par value of $5 per share and a fair value of $30 per share. During October 2024, Kohlbeck paid $16,000 to demolish an existing building on this land so it could construct a new building. 4. Construction of Building B on the newly acquired land began on October 1, 2025. By September 30, 2026, Kohlbeck had paid $320,000 of the estimated total construction costs of $450,000. It is esti- mated that the building will be completed and occupied by July 2027. 5. Certain equipment was donated to the corporation by a local university. An independent appraisal of the equipment when donated placed the fair value at $40,000 and the salvage value at $3,000. 6. Machinery A's total cost of $182,900 includes installation expense of $600 and normal repairs and maintenance of $14,900. Salvage value is estimated at $6,000. Machinery A was sold on February 1, 2026. 7. On October 1, 2025, Machinery B was acquired with a down payment of $5,740 and the remaining payments to be made in 11 annual installments of $6,000 each beginning October 1, 2025. The pre- vailing interest rate was 8%. The following data were abstracted from present value tables (rounded).

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter7: Operating Assets

Section: Chapter Questions

Problem 6MCQ: Refer to the information for Cox Inc. above. What amount would Cox record as depreciation expense...

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