with the funds received from equity and debt financing, cabot corporation mades a lump-sum purchase of several assets on January 1 at a total cash price of $840,000. the estimated market values of the purchased assets are building, $460,600; land, $284,200; land improvements, $49,000; and four vehicles, $186,200. These assets are intended to support the expansion of the company's operations in year 2.
1a. Allocate the the lump-sum purchase price to the separate assets purchased.
1b. prepare the journal entry to record the purchase.
2. Compute the first year depreciation expense on the building using the straight line method, assuming a 15 year life and a $28,000 salvage value.
3. compute the first year depreciation expense on the land improvements assuming a five year life and double declining balance depreciation.