Question

At December 31, 2020, Cord Company's plant asset and accumulated depreciation and amortization accounts had balances as follows: Accumulated Depreciation and Amortization Category Land Buildings Equipment Automobiles and trucks Leasehold improvements Land improvements Plant Asset $ 178,000 1,650,000 1,275,000 175,000 222,000 331,900 320,500 103,325 111,000 Depreciation methods and useful lives: Buildings—150% declining balance; 25 years. Equipment-Straight line; 10 years. Automobiles and trucks-200% declining balance; 5 years, all acquired after 2017. Leasehold improvements-Straight line. Land improvements-Straight line. Depreciation is computed to the nearest month and residual values are immaterial. Transactions during 2021 and other information: a. On January 6, 2021, a plant facility consisting of land and building was acquired from King Corp. in exchange for 28,000 shares of Cord's common stock. On this date, Cord's stock had a fair value of $50 a share. Current assessed values of land and building for property tax purposes are $195,000 and $585,000, respectively. b. On March 25, 2021, new parking lots, streets, and sidewalks at the acquired plant facility were completed at a total cost of $210,000. These expenditures had an estimated useful life of 12 years. c. The leasehold improvements were completed on December 31, 2017, and had an estimated useful life of eight years. The related lease, which would terminate on December 31, 2023, was renewable for an additional four-year term. On April 30, 2021, Cord exercised the renewal option. d. On July 1, 2021, equipment was purchased at a total invoice cost of $328,000. Additional costs of $10,000 for delivery and $53,000 for installation were incurred. e. On September 30, 2021, Cord purchased a new automobile for $12,800. f. On September 30, 2021, a truck with a cost of $24,300 and a book value of $9,600 on date of sale was sold for $11,800. Depreciation for the nine months ended September 30, 2021. was $2.160. g. On December 20, 2021, equipment with a cost of $18,500 and a book value of $3,050 at date of disposition was scrapped without cash recovery. Required: 1. Prepare a schedule analyzing the changes in each of the plant asset accounts during 2021. Do not analyze changes in accumulated depreciation and amortization. 2. For each asset category, prepare a schedule showing depreciation or amortization expense for the year ended December 31, 2021. Complete this question by entering your answers in the tabs below.

Answer 1

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Requirement 1			Balance			Balance
	Working		Dec 31 2020	Increase	Decrease	Dec 31 2021
Land	a		$              178,000	$       350,000		$          528,000
Land Improvements	Event b		$                          -	$       210,000		$          210,000
Building	a		$          1,650,000	$   1,050,000		$      2,700,000
Machinery and Equipment	b and event g		$          1,275,000	$       391,000	$      18,500	$      1,647,500
Automobiles and Trucks	Event e and f		$              175,000	$         12,800	$      24,300	$          163,500
Leasehold Improvements			$              222,000			$          222,000
			$          3,500,000	$   2,013,800	$      42,800	$      5,471,000
Working a-Event a
Fair Value of Shares	28,000*$50	$   1,400,000
Allocation to Land and Building:
	Price	%	Fair Value	Allocation
Land	$                                     195,000	25%	$          1,400,000	$       350,000
Building	$                                     585,000	75%	$          1,400,000	$   1,050,000
Total	$                                     780,000			$   1,400,000
Working b-Event d
Machiner Cost:
Purchase Price	$                                     328,000
Delivery	$                                       10,000
Installation	$                                       53,000
Total	$                                     391,000
Part 2. Amortization and Depreciation:
Land Improvement:
Value	$                                     210,000
Life	12 Year
Depreciation for	9 Months
Depreciation	$210,000*1/12*9/12	$         13,125
Building:
25 Year Life,150% Decline	1.50*1/25	6%
Book Value, Jan 1 2020	$1,650,000-$331,900	$   1,318,100
New Building-Pur in January		$   1,050,000
Total	a	$   2,368,100
Depreciation	a*6%	$       142,086
Machinery and Equipment:
10 Year SLM
		Value	Depreciation
For Full Year		$   1,275,000	$              127,500
Addition Pur in Jul	Half Year Dep	$       391,000	$                19,550
Total		$   1,666,000	$              147,050
Automobiles and Trucks:
5 Year Life,200% Decline	2*1/5	40%
Book Value, 1st Jan 2020	$175,000-$103,325	$         71,675
Less: Book value of Truck sold on 9/30		$          -9,600
Amount to be depreciated		$         62,075
150% Declining rate		40%	$          24,830.00
Automobile Purchased on 9/30		$         12,800
150% Declining rate, for 3 Months		40%	$             1,280.00
Truck Sold on 9/30			$             2,160.00
			$          28,270.00
Leashold:	($222,000-$111,000)/(8-3)	$         22,200
CORD COMPANY
Depreciation and Amortization Expense
For the Year Ending December 31, 2020
Land Improvements	$                             13,125
Buildings	$                           142,086
Machinery and equipment	$                           147,050
Automobiles and trucks	$                             28,270
Leasehold improvements	$                             22,200
Total depreciation and amortization expense for 2020	$                           352,731