Ayayai Corporation, a manufacturer of steel products, began operations on October 1, 2019. Ayayai’s accounting department has begun to prepare the capital asset and depreciation schedule that follows. You have been asked to assist in completing this schedule. In addition to determining that the data already on the schedule are correct, you have obtained the following information from the company’s records and personnel:

1.		Depreciation is calculated from the first day of the month of acquisition to the first day of the month of disposition.
2.		Land A and Building A were acquired together for $916,000. At the time of acquisition, the land had an appraised value of $100,000 and the building had an appraised value of $900,000.
3.		Land B was acquired on October 2, 2019, in exchange for 2,000 newly issued common shares. At the date of acquisition, the shares had a fair value of $20 each. During October 2019, Ayayai paid $12,000 to demolish an existing building on this land so that it could construct a new building.
4.		Construction of Building B on the newly acquired land began on October 1, 2020. By September 30, 2021, Ayayai had paid $340,000 of the estimated total construction costs of $470,000. It is estimated that the building will be completed and occupied by July 2022.
5.		Certain equipment was donated to the corporation by a local university. An independent appraisal of the equipment when it was donated estimated its fair value at $30,000 and the residual value at $3,000.
6.		Machine A’s total cost of $164,800 includes an installation expense of $500 and normal repairs and maintenance of $14,800. Its residual value is estimated at $5,000. Machine A was sold on February 1, 2021.
7.		On October 1, 2020, Machine B was acquired with a down payment of $29,450 and the remaining payments to be made in 11 annual instalments of $5,000 each, beginning October 1, 2020. The prevailing interest rate was 8%. The following data were determined from present-value tables and are rounded:

PV of $1 at 8%				PV of an Ordinary Annuity of $1 at 8%
10 years		0.463		10 years		6.710
11 years		0.429		11 years		7.139
15 years		0.315		15 years		8.559

a). For each numbered item in the schedule, give the correct amount. (Do not leave any answer field blank. Enter 0 for amounts.)

AYAYAI CORPORATION Capital Asset and Depreciation Schedule For Fiscal Years Ended September 30, 2020, and September 30, 2021
												Depreciation Expense, Year Ended September 30
Assets		Acquisition Date		Cost		Residual Value		Depreciation Method		Estimated Life in Years		2020		2021
Land A		Oct. 1, 2019		(1) $		N/A		N/A		N/A		N/A		N/A
Building A		Oct. 1, 2019		(2)		$40,000		Straight-line		(3)		$19,610		(4)
Land B		Oct. 2, 2019		(5)		N/A		N/A		N/A		N/A		N/A
Building B		Under construction		$340,000 to date		—		Straight-line		20		—		(6)
Donated equipment		Oct. 2, 2019		(7)		3,000		150% declining-balance		10		(8)		(9)
Machine A		Oct. 2, 2019		(10)		5,000		Double-declining-balance		8		(11)		(12)
Machine B		Oct. 1, 2020		(13)		—		Straight-line		20		—		(14)

Answer rating: 100% (QA)

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