Question
In: Accounting
On March 31, 2021, Susquehanna Insurance purchased an office building for $12,300,000. Based on their relative...
On March 31, 2021, Susquehanna Insurance purchased an office
building for $12,300,000. 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 $1,370,000
and $870,000, 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 | 10 | 10% of cost |
| Office equipment | 5 | $47,000 |
Required:
Calculate depreciation for 2021 and 2022. (Do not round
intermediate calculations.)
| depreciation | ||
| 2021 | 2022 | |
| building- | ||
| furniture- | ||
| office equipment - |
Solutions
ekkarill92 answered 3 years agoRelated Solutions
On March 31, 2021, Susquehanna Insurance purchased an office building for $12,000,000. Based on their relative...
On March 31, 2021, 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 $1,200,000
and $700,000, 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...
On March 31, 2018, Susquehanna Insurance purchased an office building for $12,600,000. Based on their relative...
On March 31, 2018, Susquehanna Insurance purchased an office
building for $12,600,000. 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 $1,220,000
and $720,000, 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...
On March 31, 2018, Susquehanna Insurance purchased an office building for $12,600,000. Based on their relative...
On March 31, 2018, Susquehanna Insurance purchased an office
building for $12,600,000. 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 $1,380,000
and $880,000, 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...
On March 31, 2018, Susquehanna Insurance purchased an office building for $11,400,000. Based on their relative...
On March 31, 2018, Susquehanna Insurance purchased an office
building for $11,400,000. 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 $1,340,000
and $840,000, 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...
On March 31, 2018, Susquehanna Insurance purchased an office building for $13,200,000. Based on their relative...
On March 31, 2018, Susquehanna Insurance purchased an office
building for $13,200,000. 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 $1,240,000
and $740,000, 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...
On March 31, 2021, the Herzog Company purchased a factory complete with vehicles and equipment. The...
On March 31, 2021, the Herzog Company purchased a factory
complete with vehicles and equipment. The allocation of the total
purchase price of $1,000,000 to the various types of assets along
with estimated useful lives and residual values are as follows:
Asset
Cost
Estimated Residual
Value
Estimated Useful
Life (in years)
Land
$ 100,000
N/A
N/A
Building
500,000
none
25
Equipment
240,000
10% of cost
8
Vehicles
160,000
$12,000
8
Total
$1,000,000
On June 29, 2022, equipment included in the March...
On March 31, 2021, the Herzog Company purchased a factory complete with vehicles and equipment. The...
On March 31, 2021, the Herzog Company purchased a factory
complete with vehicles and equipment. The allocation of the total
purchase price of $960,000 to the various types of assets along
with estimated useful lives and residual values are as follows:
Asset Cost Estimated Residual Value Estimated Useful Life (in
years) Land $ 120,000 N/A N/A Building 460,000 none 25 Equipment
260,000 10% of cost 6 Vehicles 120,000 $ 15,000 10 Total $ 960,000
On June 29, 2022, equipment included...
On March 31, 2021, the Herzog Company purchased a factory complete with vehicles and equipment. The...
On March 31, 2021, the
Herzog Company purchased a factory complete with vehicles and
equipment. The allocation of the total purchase price of $950,000
to the various types of assets along with estimated useful lives
and residual values are as follows:
Asset
Cost
Estimated Residual Value
Estimated Useful
Life (in years)
Land
$
125,000
N/A
N/A
Building
450,000
none
20
Equipment
250,000
12%
of cost
10
Vehicles
125,000
$
13,000
10
Total
$
950,000
On June 29, 2022, equipment included...
On March 31, 2015, the company purchased a office furniture for $168,000 which is expected to...
On March 31, 2015, the company purchased a office furniture for
$168,000 which is expected to last 7. The company only records
depreciation at the end of the year. (Use your fingers to count the
months.)
The adjusting journal entry on December 31, 2015 is:
On March 31, 2021, Canseco Plumbing Fixtures purchased equipment for $38,000. Residual value at the end...
On March 31, 2021, Canseco Plumbing Fixtures purchased equipment
for $38,000. Residual value at the end of an estimated four-year
service life is expected to be $2,000. The company expects the
equipment to operate for 10,000 hours. The equipment operated for
2,600 and 3,400 hours in 2021 and 2022, respectively.
Required:
a. Calculate depreciation expense for 2021 and
2022 using straight line method.
b. Calculate depreciation expense for 2021 and
2022 using double-declining balance method.
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