Please Complete all requirement and Do Not Give solve In Image format Martinez Company owns a building that appears on its prior year-end balance sheet at its original $540,000 cost less $405,000accumulated depreciation. The building is depreciated on a straight-line basis assuming a 20-year life and no salvage value. Duringthe first week in January of the current calendar year, major structural repairs are completed on the building at a $54,000 cost. Therepairs extend its useful life for 5 years beyond the 20 years originally estimated.1. Determine the building's age (plant asset age) as of the prior year-end balance sheet date.2. Prepare the entry to record the cost of the structural repairs that are paid in cash.3. Determine the book value of the building immediately after the repairs are recorded.4. Prepare the entry to record the current calendar year's depreciation.Complete this question by entering your answers in the tabs below.Required 1 Required 2 Required 3 Required 4Determine the building's age (plant asset age) as of the prior year-end balance sheet date.Age of the buildingShow Transcribed TextRequired 1years1. Determine the building's age (plant asset age) as of the prior year-end balance sheet date.2. Prepare the entry to record the cost of the structural repairs that are paid in cash.3. Determine the book value of the building immediately after the repairs are recorded.4. Prepare the entry to record the current calendar year's depreciation.Complete this question by entering your answers in the tabs below.Required 2View transaction list< ARequired 1Journal entry worksheet43Required 3 Required 4Prepare the entry to record the cost of the structural repairs that are paid in cash.Required 2 >Note: Enter debitcRecord the $54,000 cost of the structural repairs that are paid in cash. Martinez Company owns a building that appears on its prior year-end balance sheet at its original $540,000 cost less $405,000accumulated depreciation. The building is depreciated on a straight-line basis assuming a 20-year life and no salvage value. Duringthe first week in January of the current calendar year, major structural repairs are completed on the building at a $54,000 cost. Therepairs extend its useful life for 5 years beyond the 20 years originally estimated.1. Determine the building's age (plant asset age) as of the prior year-end balance sheet date.2. Prepare the entry to record the cost of the structural repairs that are paid in cash.3. Determine the book value of the building immediately after the repairs are recorded.4. Prepare the entry to record the current calendar year's depreciation.Complete this question by entering your answers in the tabs below.Required 1 Required 2Required p Required 4Required 3Determine the book value of the buildingmely after the repairs are recorded.Cost of buildingLess accumulated depreciationRevised book value of buildingShow Transcribed TextMartinez Company owns a building that appears on its prior year-end balance sheet at its original $540,000 cost less $405,000accumulated depreciation. The building is depreciated on a straight-line basis assuming a 20-year life and no salvage value. Duringthe first week in January of the current calendar year, major structural repairs are completed on the building at a $54,000 cost. Therepairs extend its useful life for 5 years beyond the 20 years originally estimated.Required 11< Required 21. Determine the building's age (plant asset age) as of the prior year-end balance sheet date2. Prepare the entry to record the cost of the structural repairs that are paid in cash.3. Determine the book value of the building immediately after the repairs are recorded.4. Prepare the entry to record the current calendar year's depreciation.Complete this question by entering your answers in the tabs below.Required 2 Required 31 Required 4View transaction listRequired 4 >< A3Prepare the entry to record the current calendar year's depreciation.Journal entry worksheetNote: Feter debts batRecord the year-end adjusting entry for the depreciation expense of thebuilding.

According to IAS -16 ( Property , Plant and equipment ) As per IAS -16 an item of Property, Plant…

Answered: Company

Business

Accounting

Company

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter22: Accounting For Changes And Errors.

Section: Chapter Questions

Problem 11E: On January 1, 2014, Klinefelter Company purchased a building for 520,000. The building had an...

See similar textbooks

Similar questions

On January 1, 2014, Klinefelter Company purchased a building for 520,000. The building had an estimated life of 20 years and an estimated residual value of 20,000. The company has been depreciating the building using straight-line depreciation. At the beginning of 2020, the following independent situations occur: a. The company estimates that the building has a remaining life of 10 years (for a total of 16 years). b. The company changes to the sum-of-the-years-digits method. c. The company discovers that it had ignored the estimated residual value in the computation of the annual depreciation each year. Required: For each of the independent situations, prepare all journal entries related to the building for 2020. Ignore income taxes.
Bliss Company owns an asset with an estimated life of 15 years and an estimated residual value of zero. Bliss uses the straight -line method of depreciation. At the beginning of the sixth year, the assets book value is 200,000 and Bliss changes the estimate of the assets life to 25 years, so that 20 years now remain in the assets life. Explain how this change will be accounted for in Blisss financial statements, and compute the current and future annual depreciation expense.
Albany Corporation purchased equipment at the beginning of Year 1 for 75,000. The asset does not have a residual value and is estimated to be in service for 8 years. Calculate the depreciation expense for Years 1 and 2 using the double-declining-balance method. Round to the nearest dollar.
Akron Incorporated purchased an asset at the beginning of Year 1 for 375,000. The estimated residual value is 15,000. Akron estimates that the asset has a service life of 5 years. Calculate the depreciation expense using the sum-of-the-years-digits method for Years 1 and 2 of the assets life.
On July 1, 2018, Mundo Corporation purchased factory equipment for 50,000. Residual value was estimated at 2,000. The equipment will be depreciated over 10 years using the double-declining balance method. Counting the year of acquisition as one-half year, Mundo should record 2019 depredation expense of: a. 7,680 b. 9,000 c. 9,600 d. 10,000
Colquhoun International purchases a warehouse for $300,000. The best estimate of the salvage value at the time of purchase was $15,000, and it is expected to be used for twenty-five years. Colquhoun uses the straight-line depreciation method for all warehouse buildings. After four years of recording depreciation, Colquhoun determines that the warehouse will be useful for only another fifteen years. Calculate annual depreciation expense for the first four years. Determine the depreciation expense for the final fifteen years of the assets life, and create the journal entry for year five.
Loban Company purchased four cars for 9,000 each and expects that they will be sold in 3 years for 1,500 each. The company uses group depreciation on a straight-line basis. Required: 1. Prepare journal entries to record the acquisition and the first years depreciation expense. 2. If one of the cars is sold at the beginning of the second year for 7,000, what journal entry is required?
Urquhart Global purchases a building to house its administrative offices for $500,000. The best estimate of the salvage value at the time of purchase was $45,000, and it is expected to be used for forty years. Urquhart uses the straight-line depreciation method for all buildings. After ten years of recording depreciation, Urquhart determines that the building will be useful for a total of fifty years instead of forty. Calculate annual depreciation expense for the first ten years. Determine the depreciation expense for the final forty years of the assets life, and create the journal entry for year eleven.
Cox Construction, a company in its 10th year of business, purchased a piece of equipment on April 1, year 9, for 20,000. Cox has used it for business purposes since the initial purchase date. The company depreciated the equipment using the MACRS half-year table for 5-year assets. For tax purposes, what is the amount of accumulated depreciation expense for the equipment as of December 31, year 10? a. 6,000 b. 10,400 c. 11,600 d. 12,800
On May 10, 2019, Horan Company purchased equipment for 25,000. The equipment has an estimated service life of 5 years and zero residual value. Assume that the straight-line depreciation method is used. Required: Compute the depreciation expense for 2019 for each of the following four alternatives: 1. Horan computes depreciation expense to the nearest day. (Use 12 months of 30 days each and round the daily depreciation rate to 2 decimal places.) 2. Horan computes depreciation expense to the nearest month. Assets purchased in the first half of the month are considered owned for the whole month. 3. Horan computes depreciation expense to the nearest whole year. Assets purchased in the first half of the year are considered owned for the whole year. 4. Horan records one-half years depreciation expense on all assets purchased during the year.
Petes Petroleum, Inc., an SEC registrant with a calendar year-end, is in the business of constructing and operating offs] lore oil platforms. Petes Petroleum is required legally to dismantle and remove the platforms at the end of their useful lives, which is estimated to be 10 years. On January 1, 2019, Pete constructed and began operating an offshore oil platform off the coast of Brazil. The total capitalized cost to construct the platform was 3,700,000. In addition, while the future cost of dismantling the oil platform is difficult to estimate, Pete believes there is a 40% chance that the future cost will be 1,425,000, a 40% chance it will be 1,650,000, and a 20% chance that it will cost 2,125,000. The appropriate discount rate is 12%, and Pete uses the straight-line method of depreciation. Required: 1. Prepare the journal entries that Pete should record in 2019 related to the oil platform. 2. Prepare an amortization schedule for the asset retirement obligation. 3. Next Level Prepare a table showing the effect of accounting for the asset retirement obligation on assets, liabilities, shareholders equity, and net income relative to accounting for the associated costs at the end of the assets service life when the expenditure is made.