Funseth Company purchased a five-story office building on January 1, 2014, at a cost of $5,000,000. The building has a residual value of $200,000 and a 30-year life. The straight-line depreciation method is used. On June 30, 2016, construction of a sixth floor was completed at a cost of $1,650,000. Required: Calculate the depreciation on the building and building addition for 2016 and 2017 assuming that the addition did not change the life or residual value of the building.
Funseth Company purchased a five-story office building on January 1, 2014, at a cost of $5,000,000. The building has a residual value of $200,000 and a 30-year life. The straight-line depreciation method is used. On June 30, 2016, construction of a sixth floor was completed at a cost of $1,650,000. Required: Calculate the depreciation on the building and building addition for 2016 and 2017 assuming that the addition did not change the life or residual value of the building.
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
Chapter11: Depreciation, Depletion, Impairment, And Disposal
Section: Chapter Questions
Problem 2RE: Akron Incorporated purchased an asset at the beginning of Year 1 for 375,000. The estimated residual...
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Funseth Company purchased a five-story office building on January 1, 2014, at a cost of $5,000,000. The building has a residual value of $200,000 and a 30-year life. The
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