Solution 3 - / $2,550,000 = 23% * $2,000,000 = $460,000...

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Homework Problem 3 Solution 1(a) ($1,000,000 - $250,000) / 20 = $37,500 / 12 = 3125 per month 2006: Depreciation expense $28,125 Accumulated depreciation $28,125 2007: Depreciation expense $37,500 Accumulated depreciation $37,500 1(b) ($80,000 - $5,000) / 120,000 = $.63 per mile 2007: Depreciation expense $2,520 (4,000*.63) Accumulated depreciation $2,520 2008: Depreciation expense $20,160 (32,000*.63) Accumulated depreciation $20,160 ____A/D _____ Book Value = Cost – A/D: $2,520 $57,320 = $80,000 - $22,680 ______$20,160 $22,680 2(a) Cash $50,000 A/D $20,000 Loss $20,000 Equipment $90,000 2(b) Cash $300,000 A/D $120,000 Building $200,000 Gain $220,000 2(c) Building $500,000 / $2,550,000 = 20% * $2,000,000 = $400,000 Land $800,000 / $2,550,000 = 31% * $2,000,000 = $620,000 Inventory $300,000 / $2,550,000 = 12% * $2,000,000 = $240,000 Computers $350,000 / $2,550,000 = 14% * $2,000,000 = $280,000 Furniture $600,000
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Unformatted text preview: / $2,550,000 = 23% * $2,000,000 = $460,000 Total FMV $2,550,000 2(c) continued Building $400,000 Land $620,000 Inventory $240,000 Computers $280,000 Furniture $460,000 Cash $2,000,000 2(d) Building $300,000 Land $200,000 Inventory $500,000 Goodwill $1,000,000 Cash $2,000,000 3 November 15 th : Wage Expense $36,000 FICA payable $2,340 Federal payable $10,700 State payable $4,400 Cash $18,650 Payroll Tax Expense $3420 FUTA payable $720 SUTA payable $360 FICA payable $2,340 4 August 1 st 2003: Cash $200,000 Note Payable $200,000 Dec 31 st 2003: Interest Expense $4,165 Int. Payable $4,165 Dec 31 st 2004: Interest Expense $10,000 Int. Payable $10,000 Dec 31 st 2005: Interest Expense $10,000 Int. Payable $10,000 August 1 st 2006: Note Payable $200,000 Interest Payable $24,165 Interest Expense $5,831 Cash $229,996 (rounding, $330,000 ok)...
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Solution 3 - / $2,550,000 = 23% * $2,000,000 = $460,000...

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