E$7-4($Algo$)$ Computing and Recording Cost and Depreciation of Assets in a Basket Purchase $($Straight$-$

Line Depreciation$)$ L$07-2,7-3$

Zeidler Company bought a building and the land on which the building is located for a total cash price of $$187,000.$ The company paid

transfer costs of $$3,800.$ Renovation costs on the building were $$28,700.$ An independent appraiser provided market values for the

land, $$290,000,$ and building, $$870,000$ before renovation.

Required:

Apportion the cost of the property on the basis of the appraised values. $($Input all amounts as positive values.$)$

Prepare the journal entry to record the purchase of the building and land, including all expenditures. Assume that all transactions

were for cash and that all purchases occurred at the start of the year. $($If no entry is required for a transaction$/$event$,$ select $"$No

journal entry required" in the first account field.$)$

Journal entry worksheet

$1$

Record purchase of building and land.

Note: Enter debits before credits.

Compute depreciation of the building at the end of one year, using the straight$-$line method. Assume an estimated useful life of $12$

years and an estimated residual value of $$15,800.$E$7-4($Algo$)$ Computing and Recording Cost and Depreciation of Assets in a Basket Purchase $($Straight$-$

Line Depreciation$)$ L$07-2,7-3$

Zeidler Company bought a building and the land on which the building is located for a total cash price of $$187,000.$ The company paid

transfer costs of $$3,800.$ Renovation costs on the building were $$28,700.$ An independent appraiser provided market values for the

land, $$290,000,$ and building, $$870,000$ before renovation.

Required:

Apportion the cost of the property on the basis of the appraised values. $($Input all amounts as positive values.$)$

Prepare the journal entry to record the purchase of the building and land, including all expenditures. Assume that all transactions

were for cash and that all purchases occurred at the start of the year. $($If no entry is required for a transaction$/$event$,$ select $"$No

journal entry required" in the first account field.$)$

Journal entry worksheet

Record purchase of building and land.