Student Name: Instructor Class: McGraw-Hill/Irwin Problem 11-02 Requirement 1: CORD COMPANY Analysis of Changes in Plant Assets For

the Year Ending December 31, 2011 Balance 12/31/2010 $ 175,000 1,500,000 1,125,000 172,000 216,000 $ 3,188,000
Correct!

Land (1) Land improvements Buildings (1) Machinery and equipment (2) Automobiles and trucks Leasehold improvements

Increase 312,500 192,000 937,500 385,000 12,500 $ 1,839,500 $

Correct!

Decrease $ 17,000 24,000 41,000

Correct!

Explanation of Amounts: (1) Plant facility acquired from King 1/6/2011 - allocation to Land and Building: Shares 25,000 Market price $ 50 Fair value of shares $ 1,250,000
Correct!

Allocation in proportion to appraised values at date of exchange: Amount 187,500 562,500 $ 750,000 $ % of Total Allocation 25% $ 312,500 75% 937,500 100% $ 1,250,000

Land Building

(2) Machinery and equipment purchased 7/1/2011: Invoice cost Delivery cost Installation cost Total acquisition cost

325,000 10,000 50,000 385,000

- Correct!

Student Name: Instructor Class: McGraw-Hill/Irwin Problem 11-02

Requirement 2:

CORD COMPANY Depreciation and Amortization Expense For the Year Ended December 31, 2011 Land Improvements: Cost Straight-line rate Annual depreciation Depreciation on land improvements for 2011 Buildings: Book value, 1/1/2011 Building acquired 1/6/2011 Total amount subject to depreciation 150% declining balance rate Machinery and equipment: Balance, 1/1/2011 Straight-line rate Purchased on 7/1/2011 Depreciation for one-half year Depreciation on machinery and equipment for 2011 Automobiles and trucks: Book value, 1/1/2011 Deduct 1/1/2011 book value of truck sold on 9/30 Amount subject to depreciation 150% declining balance rate Automobile purchased, 8/30/2011 Depreciation for 2011 Truck sold on 9/30/2011 - depreciation Depreciation on automobiles and trucks Leasehold improvements: Book value, 1/1/2011 Amortization period, years Amortization of leasehold improvements for 2011 Total depreciation and amortization expense for 2011

192,000 8.33% 16,000 75% $

12,000
Correct!

1,171,100 937,500 2,108,600 6% $

126,516
Correct!

1,125,000 10% 385,000 5% $

112,500 19,250 131,750

Correct!

71,675 (11,750) 59,925 30% $ 12,500 10% $

17,978 1,250 2,650 21,878

Correct!

108,000 5 21,600
Correct!

313,744
Correct!

CORD COMPANY is of Changes in Plant Assets Year Ending December 31, 2011 Balance 12/31/2011 $ 487,500 192,000 2,437,500 1,493,000 160,500 216,000 $ 4,986,500
Correct!

- Correct! - Correct!

Given Data P11-02: CORD COMPANY Accumulated Depreciation & Amortization $ 328,900 317,500 100,325 108,000 Depreciation Method 150% Declining balance Straight-line 150% Declining balance Straight-line Straight-line

Category Land Buildings Machinery and equipment Automobiles and trucks Leasehold improvements Land improvements

Buildings Machinery and equipment Automobiles and trucks Leasehold improvements Land improvements Transactions and other information: Common shares exchanged for land and building Common share fair value Assessed value of land Assessed value of building Parking lots, streets and sidewalk costs Useful life of expenditures Leasehold improvements useful life Machinery and equipment purchase Delivery costs Installation costs New auto purchase Truck - cost Truck - carrying amount Truck sale Truck depreciation for 9 months Machine - cost Machine - carrying amount

Plant Asset $ 175,000 1,500,000 1,125,000 172,000 216,000 Useful Life (years) 25 10 5

$ $ $ $

$ $ $ $ $ $ $ $ $ $

25,000 50 187,500 562,500 192,000 12 years 8 years 325,000 10,000 50,000 12,500 24,000 9,100 11,500 2,650 17,000 2,975

Student Name: Instructor Class: McGraw-Hill/Irwin Problem 11-03 PELL CORPORATION Depreciation Expense For the Year Ended December 31, 2011 Land Improvements Cost Straight-line rate Building: Book value 12/31/2010 150% declining balance rate

180,000 6.67% $

12,000
Correct!

$ 1,150,000 7.5% $

86,250
Correct!

Machinery and Equipment: Balance, 12/31/2010 $ 1,158,000 Deduct machine sold (58,000) $ 1,100,000 Straight-line rate 10% $ Purchased 1/2/2011 $ 287,000 Depreciation 10% Machine sold 3/31/2011 $ 58,000 Depreciation for three months 2.5% Total depreciation on machinery and equipment $ Automobiles: Book value on 12/31/2010 150% declining balance rate Total depreciation expense for 2011

110,000 28,700 1,450 140,150

Correct!

38,000 50% $

19,000
Correct!

257,400
Correct!

Given Data P11-03: PELL CORPORATION Plant asset and accumulated depreciation accounts: Land Land improvements Building Machinery and equipment Automobiles Transactions during 2011: Machinery and equipment purchase Freight charge (included in purchase price above) Installation costs Machine purchase, 2007 Machine sale, 2011 Depreciation Repaving cost Common shares exchanged for land Market price per share Legal fees and title insurance Cost to raze building New automobile cost Old automobile cost Old automobile depreciation Old automobile fair value Useful Life (years) 15 20 10 3

350,000 180,000 1,500,000 1,158,000 150,000

$45,000 350,000 405,000 112,000

$ $ $ $ $ $ $ $ $ $ $ $ $ $

260,000 5,500 27,000 58,000 36,500 24,650 50,000 10,000 38 23,000 35,000 15,250 18,000 13,500 3,750

Land improvements Building Machinery and equipment Automobiles

Depreciation Method Straight-line 150% Declining balance Straight-line 150% Declining balance

Student Name: Instructor Class: McGraw-Hill/Irwin Problem 11-06 Requirement 1: Building: Cost at 3/31/09 Estimated life Straight-line rate Machinery: Cost at 3/31/09 Estimated life Residual Value Straight-line rate

$500,000 25 75.00% $

15,000
Correct!

$ $

240,000 8 24,000 75.00% $

20,250
Correct!

Equipment: Cost at 3/31/09 Estimated life Residual Value Sum-of-the-years'-digits rate Sum-of-the-digits Requirement 2: General Journal Account 1. 6/29/2012 Depreciation Expense Accumulated depreciation-machinery Machinery sold 6/29/2012: Cost at 3/31/09 Estimated life Residual Value Straight-line rate

$ $

160,000 6 13,000 75.00% 21 $

31,500
Correct!

Debit 5,625

Credit

5,625

$ $

100,000 8 10,000 50.00% $

5,625
Correct!

2. 6/29/2012 Cash Accumulated depreciation-machinery Loss on sale of machinery Machinery 2011 Depreciation: Cost at 3/31/11 Estimated life Residual Value Straight-line rate 80,000 14,063 5,937 100,000
Correct!

$100,000 8 $10,000 75.00%

$8,438

Correct!

2012 Depreciation: Cost at 3/31/11 Estimated life Residual Value Straight-line rate

$100,000 8 $10,000 50.00%

$5,625
Correct!

Requirement 3: Building: Cost at 3/31/11 Estimated life Straight-line rate Machinery: Cost at 3/31/11 Estimated life Residual Value Straight-line rate Equipment: Cost at 3/31/11 Estimated life Residual Value 2011 Sum-of-the-years'-digits rate 2012 Sum-of-the-years'-digits rate Sum-of-the-digits

$500,000 25 100.00%

$20,000
Correct!

$140,000 8 $14,000 100.00%

$15,750
Correct!

$160,000 6 $13,000 25.00% 75.00% 21

$36,750
Correct!

Given Data P11-06: HERZOG COMPANY

Asset Land Building Machinery Equipment Total

Cost $ 100,000 500,000 240,000 160,000 $ 1,000,000

Estimated Residual Value N/A none 10% of cost $13,000

Estimated Useful Life in Years N/A 25 8 6

Additional information: Machinery sold 6/29/12 $ 80,000 Original cost of machinery on 3/31/09 $ 100,000 Depreciation method for buildings and Straight Line machinery Depreciation method for equipment Sum-of-the-years' digits Partial-year depreciation based on months in service

Student Name: Instructor Class: McGraw-Hill/Irwin Problem 11-07 Requirement 1: MARION COMPANY Depletion and Depreciation Cost of mineral mine: Purchase price Development costs

$ 1,600,000 600,000 $ 2,200,000

Correct!

Depletion: Land resale value Estimated ore extracted (tons) Depletion per ton 2011 Ore extracted (tons) Depletion 2012 Ore extracted (tons) Revised ore extraction (tons) Revised depletion rate Depletion Depreciation: Structures: Building cost Depreciation per ton 2011 depreciation Revised depreciation rate 2012 depreciation Equipment: Equipment cost Estimated equipment sale Depreciation per ton 2011 depreciation Revised depreciation rate 2012 depreciation

100,000 400,000 $5.25

Correct!

50,000 262,500
Correct!

80,000 487,500 $4.20 336,000

Correct!

$ $ $ $ $

150,000 0.375
Correct!

18,750
Correct!

0.30 24,000
Correct!

$ $ $ $ $ $

80,000 4,000 0.19

Correct!

9,500
Correct!

0.152 12,160
Correct!

Student Name: Instructor Class: McGraw-Hill/Irwin Problem 11-07

Requirement 2: MARION COMPANY Book Value Mineral mine: Cost Less accumulated depletion: 2011 depletion 2012 depletion Book value, 12/31/2012 Structures: Cost Less accumulated depreciation: 2011 depreciation 2012 depreciation Book value, 12/31/2012 Equipment: Cost Less accumulated depreciation: 2011 depreciation 2012 depreciation Book value, 12/31/2012

$ 2,200,000 $ 262,500 336,000

598,500 $ 1,601,500
Correct!

$ $ 18,750 24,000 $

150,000

42,750 107,250
Correct!

$ $ 9,500 12,160 $

80,000

21,660 58,340
Correct!

Given Data P11-07: MARION COMPANY Land purchase Additional development costs Estimated tons extracted Land resale value Building costs Useful life of buildings New equipments cost Auction price of equipment 2011 ore extracted and sold Revised estimated tons extracted 2012 ore extracted Ore sold from 2010 extraction $ 1,600,000 $ 600,000 $ 400,000 $ 100,000 $ 150,000 10 $ 80,000 $ 4,000 50,000 487,500 80,000 60,000

years

tons tons tons