Chapter 9, Problem 9.5AP

(a)

To determine

Plant assets

Plant assets are the long-term and tangible assets used in business over a period of time in day-to-day business operation to generate revenue. The plant assets are shown in the fixed asset section of the balance sheet.

Straight-line Depreciation Method

It is a method of providing depreciation. In this method, depreciation is calculated as fixed percentage of the original cost of the fixed asset. The amount of depreciation in this method remains same for all the years of the useful life of the asset.

The following is the formula to calculate the depreciation.

$\text{Depreciation expense = }\frac{\text{Cost of the asset – Salvage value}}{\text{Estimated useful life of the asset}}$

To record: journal entry for the purchase of land.

 (b)

To determine

To record: the adjusting entries for depreciation of building

(c)

To determine

Prepare partial balance sheet for G Company.