Chapter 3
Long-Term Assets
117
AP-3B (
2
)
On September 5, 2016, land, building and equipment were purchased for a total amount of
$1,300,000. The assessed value of each asset at the time of acquisition is as follows: Land—
$845,000; Building—$325,000; Equipment—$455,000. Write the journal entry that records the
purchase.
Date
Account Title and Explanation
Debit
Credit
AP-4B (
3
4
)
On April 1, 2008, Bob’s Juice Factory purchased a new bottle sealing machine for $99,000. The
machine had an estimated useful life of 10 years and is expected to have no residual value.
Assume that the company has adopted a partial‐year depreciation policy, where depreciation
is taken on a monthly basis.
Required
a) Prepare the table using the following facts.
• The company uses straight-line depreciation.
• The asset is sold on April 30, 2016 for $31,000.
• The company's fiscal year-end is December 31.
Year
Cost of Long-Term
Asset
Depreciation
Expense
Accumulated
Depreciation
To Date
Net Book Value
