A. Suppose you make a lump-sum purchase of land, building, and equipment on April 30. At the time of your purchase, the land has a current market value of $245,000, the building's market value is $355,000, and the equipment's market value is $185,000. Journalize the lump-sum purchase of the three assets for a total cost of $700,000. You sign a note payable for this amount.

Required:

Prepare the journal entry for the lump-sum purchase. (Record debits first, then credits. Exclude explanations from journal entries. Round intermediary calculations to two decimal places and final amounts to the nearest whole dollar.)

B. The accounting firm of Belvidere&Roberge,CPAs, purchased land, paying $480,000

cash. In addition, the company paid property tax in arrears of $3,250, a legal fee of

$6,000, and a $21,000 charge for levelling the land and removing an unwanted building. The company constructed an office building on the land at a cost of $1,650,000. It also paid

$48,000 for a fence around the boundary of the property, $9,000 for the company sign near the entrance to the property, and $15,500 for special lighting of the grounds. During installation of the fence, $2,100 of damage to the fence was incurred. Determine the cost of the company's land, land improvements, and building.

Required:

Land cost

Land Improvement cost

The cost of the building

C. Granville Machine & Dye bought a machine on January 2, 2020, for $414,000.

The machine was expected to remain in service for three years and produce 2,120,000

parts. At the end of its useful life, company officials estimated that, due to technological changes, the machine's residual value would only be $9,000.The machine produced 742,000

parts in the first year, 699,600 in the second year, and 689,000 in the third year.

Required

1.	Prepare a schedule of amortization expense per year for the machine using the straight-line, UOP, and DDB amortization methods. Assume that in all cases the machine is valued at $9,000 at the end of the third year, and the third-year amortization is adjusted (set as a plug) to ensure this happens.
2.	Which amortization method results in the highest net income in the second year? Does this higher net income mean the machine was used more efficiently under this method?
3.	Which method tracks the wear and tear on the machine most closely? Why?
4.	After one year under the DDB method, the company switched to the straight-line method. Prepare a schedule of amortization expense for this situation, showing all calculations.

D. On January 13, 2019, Bill's Birdfeeders purchased store fixtures for $72,000 cash, expecting the fixtures to remain in service for 10 years. Bill's Birdfeeders has amortized the fixtures on a DDB basis with an estimated residual value of $6,400. On September 30, 2020, Bill's Birdfeeders sold the fixtures for $22,000 cash because they were not environmentally friendly. Record the amortization expense on the fixtures for the years ended December 31, 2019, and for 2020,and sale of the fixtures on September 30, 2020.

Required

Record the amortization expense for 2019.

(Record debits first, then credits. Exclude explanations from journal entries. Round your final answer to the nearest whole dollar.)

E. Brownline Company manufactures flat screen monitors for the graphics industry. It purchased a patent for the design of a new monitor for $675,000. Although it gives legal protection for 20 years, the patent is expected to provide Brownline Company with a competitive advantage for only ten years. After using the patent for two years, Brownline Company learns at an industry trade show that another company is designing a more effective monitor. Based on this new information, Brownline Company decides to amortize the remaining cost of the patent over the current year, giving the patent a total useful life of three years.

Required

1.	Prepare the journal entry to record the purchase of the patent on January 1, 2020.
2.	Assume straight-line amortization is used. Record the journal entry for amortization at December 31, 2020.
3.	Record amortization for the year ended December 31, 2022.

F. Toys acquired companies with assets with a market value of $49 million and liabilities of $33

million. Gemma paid $30 million for these acquisitions during the year ended December 31,

2020.

Required

1.	How would a value be assigned to the net assets acquired?
2.	What value would be assigned to goodwill?
3.	Will the goodwill be amortized? If so, by how much?