80.2K

Verified Solution

Link Copied!

On March $31,2024,$ the Herzog Company purchased a factory complete with vehicles and equipment. The allocation of the total purchase price of $$1,100,000$ to the various types of assets along with estimated useful lives and residual values are as follows:

$\backslash$table$[[$Asset$,$Cost,$\backslash$table$[[$Estimated$],[$Residual Value$]],\backslash$table$[[$Estimated$],[$Useful Life$],[($in years$)]]],[$Land$,$$$150,000,$N$/$A$,$N$/$A$],[$Building$,600,000,$none,$25],[$Equipment$,140,000,128$ of cost$,10],[$Vehicles$,210,000,$$$15,000,10],[$Total$,$$$1,100,000,,]]$

On June $29,2025,$ equipment included in the March $31,2024,$ purchase that cost $$110,000$ was sold for $$90,000.$ Herzog uses the straight$-$line depreciation method for building and equipment and the double$-$declining$-$balance method for vehicles. Partial$-$year depreciation is calculated based on the number of months an asset is in service.

Required:

Compute depreciation expense on the building, equipment, and vehicles for $2024.$

Prepare the journal entries to record the depreciation on the equipment sold on June $29,2025,$ and the sale of equipment.

Compute depreciation expense on the building, remaining equipment, and vehicles for $2025.$

Complete this question by entering your answers in the tabs below.

Required $3$

Compute depreciation expense on the building, equipment, and vehicles for $2024.$

Note: Do not round intermediate calculations.

Answer & Explanation Solved by verified expert

See Answer