Question

Garrett Corporation paid $200,000 to acquire land, buildings, and equipment. At the time of acquisition, Garrett...

Garrett Corporation paid $200,000 to acquire land, buildings, and equipment. At the time of acquisition, Garrett paid $20,000 for an appraisal, which revealed the following values: land, $100,000; buildings, $125,000; and equipment, $25,000.

Required:

2. Assume that Garrett uses IFRS and chooses to use the revaluation model to value its property, plant, and equipment. At the end of the year, the book value of the land, buildings, and equipment are $88,000, $104,000, and $18,000 respectively. The company determines that the fair value of land, buildings, and equipment at the end of year is $110,000, $106,000, and $15,000, respectively. Prepare the journal entries that Garrett should make to value its property, plant, and equipment.

Homework Answers

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Greer Manufacturing purchases property that includes land, buildings and equipment for $4.7 million. The company pays...
Greer Manufacturing purchases property that includes land, buildings and equipment for $4.7 million. The company pays $178,000 in legal fees, $220,000 in commissions, and $106,000 in appraisal fees. The land is estimated at 28%, the buildings are at 41%, and the equipment at 31% of the property value. Required: Determine the total acquisition cost of this "basket purchase". Allocate the total acquisition cost to the individual assets acquired. Prepare the journal entry to record the purchase assuming that the company...
Greer Manufacturing purchases property that includes land, buildings and equipment for $5.4 million. The company pays...
Greer Manufacturing purchases property that includes land, buildings and equipment for $5.4 million. The company pays $173,000 in legal fees, $222,000 in commissions, and $104,000 in appraisal fees. The land is estimated at 22%, the buildings are at 44%, and the equipment at 34% of the property value. Required: Determine the total acquisition cost of this "basket purchase". Allocate the total acquisition cost to the individual assets acquired. Prepare the journal entry to record the purchase assuming that the company...
Greer Manufacturing purchases property that includes land, buildings and equipment for $5.4 million. The company pays...
Greer Manufacturing purchases property that includes land, buildings and equipment for $5.4 million. The company pays $181,000 in legal fees, $227,000 in commissions, and $109,000 in appraisal fees. The land is estimated at 28%, the buildings are at 38%, and the equipment at 34% of the property value. Required: Determine the total acquisition cost of this "basket purchase". Allocate the total acquisition cost to the individual assets acquired. Prepare the journal entry to record the purchase assuming that the company...
Greer Manufacturing purchases property that includes land, buildings and equipment for $5.3 million. The company pays...
Greer Manufacturing purchases property that includes land, buildings and equipment for $5.3 million. The company pays $172,000 in legal fees, $221,000 in commissions, and $112,000 in appraisal fees. The land is estimated at 26%, the buildings are at 39%, and the equipment at 35% of the property value. Required: 1. Determine the total acquisition cost of this "basket purchase". 2. Allocate the total acquisition cost to the individual assets acquired. 3. Prepare the journal entry to record the purchase assuming...
Harding Corporation acquired real estate that contained land, building and equipment. The property cost Harding $1,900,000....
Harding Corporation acquired real estate that contained land, building and equipment. The property cost Harding $1,900,000. Harding paid $525,000 and issued a note payable for the remainder of the cost. An appraisal of the property reported the following values: Land, $555,000; Building, $1,650,000 and Equipment, $1,095,000. (Round percentages to two decimal places: ie .054 = 5%). Assume that Harding uses the units-of-production method when depreciating its equipment. Harding estimates that the purchased equipment will produce 1,100,000 units over its 5-year...
Harding Corporation acquired real estate that contained land, building and equipment. The property cost Harding $1,995,000....
Harding Corporation acquired real estate that contained land, building and equipment. The property cost Harding $1,995,000. Harding paid $560,000 and issued a note payable for the remainder of the cost. An appraisal of the property reported the following values: Land, $592,000; Building, $1,760,000 and Equipment, $1,168,000. (Round your intermediate percentages to the nearest whole number: i.e 0.054231 = 5%. Do not round any other intermediate calculations.) Assume that Harding uses the units-of-production method when depreciating its equipment. Harding estimates that...
Plant acquisitions for selected companies are as follows. 1. Crane Industries Inc. acquired land, buildings, and...
Plant acquisitions for selected companies are as follows. 1. Crane Industries Inc. acquired land, buildings, and equipment from a bankrupt company, Torres Co., for a lump-sum price of $ 798,000. At the time of purchase, Torres’s assets had the following book and appraisal values. Book Values Appraisal Values Land $ 228,000 $ 171,000 Buildings 285,000 399,000 Equipment 342,000 342,000 To be conservative, the company decided to take the lower of the two values for each asset acquired. The following entry...
lant acquisitions for selected companies are as follows. 1. Shamrock Industries Inc. acquired land, buildings, and...
lant acquisitions for selected companies are as follows. 1. Shamrock Industries Inc. acquired land, buildings, and equipment from a bankrupt company, Torres Co., for a lump-sum price of $1,050,000. At the time of purchase, Torres’s assets had the following book and appraisal values. Book Values Appraisal Values Land $300,000 $225,000 Buildings 375,000 525,000 Equipment 450,000 450,000 To be conservative, the company decided to take the lower of the two values for each asset acquired. The following entry was made. Land...
Harding Corporation acquired real estate that contained land, building and equipment. The property cost Harding $2,375,000....
Harding Corporation acquired real estate that contained land, building and equipment. The property cost Harding $2,375,000. Harding paid $700,000 and issued a note payable for the remainder of the cost. An appraisal of the property reported the following values: Land, $740,000; Building, $2,200,000 and Equipment, $1,460,000. (Round your intermediate percentages to the nearest whole number: i.e 0.054231 = 5%. Do not round any other intermediate calculations.) Assume that Harding uses the units-of-production method when depreciating its equipment. Harding estimates that...
1. Sandhill Industries Inc. acquired land, buildings, and equipment from a bankrupt company, Torres Co., for...
1. Sandhill Industries Inc. acquired land, buildings, and equipment from a bankrupt company, Torres Co., for a lump-sum price of $910,000. At the time of purchase, Torres’s assets had the following book and appraisal values. Book Values Appraisal Values Land $260,000 $195,000 Buildings 325,000 455,000 Equipment 390,000 390,000 To be conservative, the company decided to take the lower of the two values for each asset acquired. The following entry was made. Land 195,000 Buildings 325,000 Equipment 390,000    Cash 910,000 2....
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT