Acc200Day12 - Click to edit Master subtitle style Accy 200...

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Unformatted text preview: Click to edit Master subtitle style Accy 200 Day 12 Peter A. Silhan Click to edit Master subtitle style CHAPTER 6 Accounting for and Presentation of Property, Plant, and Equipment (PPE) , & Other Noncurrent Assets Noncur rent Assets Land Equipment Buildings Intangible Assets Natural Resources © ® Proper ty , Plant & Equipment PPE- cost RE: Depr Expense Accumulated Depreciation (contra asset) Cas h Capital Expenditures c r d r c r d r Note: PPE at cost + (AccDepr) = PPE- net contra-asset “credit normal” i.e., “land”, which does not “ depreciate ” Capital Expenditure (“capex”) Costs of acquir ing, constr ucting, adding, and replacing fixed assets acquir ing, constr ucting costs added t o constr uction in progress account General and admin costs should not be added t o PPE O bj1 0 1 O bj1 0 2 D e c l i n e i n a s s e t v a l u e o v e r i t s u s e f u l l i f e Pr imar y I ssues for Noncur rent Assets Acquisition Accounting for acquisition of the asset. Use Accounting for depreciation of the asset. Accounting for maintenance and repair costs. Disposal Accounting for the disposition of the asset. Land is not depreciated !!! Purchase price Real estate commissions Title insurance premiums Delinquent taxes Razing costs of building on the land Title and legal fees Land All costs incurred to get land ready for use are capitalized . GENERAL JOURNAL Date Account Titles and Explanation Debit Credit Land 250,000 Cash 250,000 Land Assume that a company incur s $250,000 to pur chase land and get it r eady for use in its business....
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This note was uploaded on 10/16/2010 for the course ACCY Accy 200 taught by Professor Xxx during the Spring '10 term at University of Illinois at Urbana–Champaign.

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Acc200Day12 - Click to edit Master subtitle style Accy 200...

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