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World chapion pittsburgh penguin company purchased the following assets on january 1, 2016: Building: this...

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Accounting

World chapion pittsburgh penguin company purchased the following assets on january 1, 2016: Building: this is a new office building that the firm paid cash in the amount of $1,000,000. The company estimates it has a useful ife of 40 years with a salvage value of $160,000. Straight line depreciation will be used. Equipment: this is a new piece of customized equipment tat the firm paid $700,000. the equipment is estimated to have a useful life of 200,000 hours of use and has an estimated salvage value of $100,000. the company used the equipment for 35,000 hours during 2010. The units of activity method of depreciation will be used. Answer the following: 1. Calculate depreciation expense for 2016 for the buliding and prepare the journal entry 2. Calculate the depreciation expense for 2016 for the equipment and prepare the journal entry 3. Assume that the company used the double declining balance method of deprciation for the building. Calculate the depreciation expense for 2016 and 2017 for the building, no journal entries required, just the value of eah year.

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