Bridge City Consulting bought a building and the land on which it is located for

Question

Bridge City Consulting bought a building and the land on which it is located for $175,000 cash. The land is estimated to represent 70 percent of the purchase price. The company paid $20,000 for building renovations before it was ready for use. value: Required information .00 points Required 2. Prepare the journal entry to record all expenditures. Assume that all transactions were for cash and they occurred at the start of the year. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet Record all expenditures for the land and buildings assuming all transactions were paid for with cash and occurred at the start of the year. Note: Enter debits before credits. Transaction General Journal Debit Credit Record entry Clear entry View general journal

Explanation / Answer

2) Journal entry :

3) Straight line depreciation = (72500-19500)/10 = 5300 per year

4) Book value at the end of year 2 :

Land = $122500

Building = 72500-(5300*2) = $61900

Date account & explanation debit credit Land (175000*70%) 122500 Building (175000*30%+20000) 72500 Cash 195000 (To record purchase land and building)

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