60.1K

Verified Solution

Link Copied!

The Thompson Corporation, a manufacturer of steel products, began operations on October 1, 2019. The accounting department of Thompson has started the fixed-asset and depreciation schedule presented below. 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 CV of S1.PV of $1. FVA of S1.PVA of S1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) a. Depreciation is computed from the first of the month of acquisition to the first of the month of disposition Land A and Building A were acquired from a predecessor corporation. Thompson paid $832,500 for the land and building together. At the time of acquisition, the land had a fair value of $110,400 and the building had a fair value of $809,600. Land 8 was acquired on October 2, 2019. in exchange for 3,200 newly issued shares of Thompson's common stock. At the date of acquisition, the stock had a par value of $5 per share and a fair value of $27 per share. During October 2019, Thompson paid $10,600 to demolish an existing building on this land so it could construct a new building. d. Construction of Building B on the newly acquired land began on October 1, 2020. By September 30, 2021, Thompson had paid $230,000 of the estimated total construction costs of $320,000. Estimated completion and occupancy are July 2022. e. Certain equipment was donated to the corporation by the city. An independent appraisal of the equipment when donated placed the fair value at $16,800 and the residual value at $2,200. Equipment A's total cost of $112.000 includes Installation charges of $570 and normal repairs and maintenance of $13,000. Residual value is estimated at $4.500. Equipment A was sold on February 1, 2021. g. On October 1, 2020, Equipment B was acquired with a down payment of $4,200 and the remaining payments to be made in 10 annual installments of $4,200 each beginning October 1, 2021. The prevailing interest rate was 7%. Required: Supply the correct amount for each answer box on the schedule. (Round your intermediate calculations and final answers to the nearest whole dollar.) THOMPSON CORPORATION Fixed Asset and Depreciation Schedule For Fiscal Years Ended September 30, 2020, and September 30, 2021 Depreciation for Year Ended 9/30 Acquisition Date Depreciation Method Assets Cost Estimated Lite In Years Residual 2020 NA 2021 NA NA NA 51,000 $ $ 14 200 NA NA NA Land A Building A Land B Building B Donated Equipment Equipment A Equipment B 10/1/2019 10/1/2019 10/2/2019 Under construction 10/2/2019 10/2/2019 10/1/2020 230,000 to date not applicable Straight-line not applicable Straight-line 200% Declining balance Sum-of-the years'-digits Straight-line NA 30 10 9 2,200 4,500 15

Answer & Explanation Solved by verified expert

See Answer