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1;Class - PP&E, also known as plant assets, are important to the operation of any business as you might imagine.;Using the guidance above, consider what assets are needed to run the business and consider how you might actually pay for them?;2;In the spotlight about FedEx Corporation, you get a feel for the amount of investment in assets and the resulting liabilities that are required to operate a competitive corporation. Even small businesses require plant, property, and equipment to compete and normally rely on some form of debt to finance themselves. Let's start up a company that sells auto parts, like Napa or Auto Zone. What assets would we require? How might we finance them?;3.;what is depreciation? What are the different methods and when would each be appropriate? How do we apply this concept to natural resources? Intangibles?;4;he unadjusted trial balance and income statement amounts from the December 31 adjusted trial balance of Anderson Production Company follows.;Anderson Production Company;Account Unadjusted;Trial Balance From the Adjusted;Trial Balance;Cash 14,100;Prepaid rent 800;Equipment 42,000;Accumulated depreciation 3,400;Accounts payable 5,100;Salary payable;Unearned service revenue 9,100;Income tax payable;Notes payable, long-term 16,000;Common stock 8,600;Retained earnings 8,500;Dividends 1,400;Service revenue 13,200 19,500;Salary expense 4,300 4,600;Rent expense 1,300 1,600;Depreciation expense 700;Income tax expense 1,500;Total 63,900;63,900 8,400 19,500;Journalize one of the adjusting and one of the closing entries of Anderson Production Company at December 31. Note that there was only one adjustment to Service Revenue.;5;This is a good exercise to practice recording the cost of plant assets.;Paul;E7-15A Murphy Self Storage purchased land, paying $150,000 cash as a down payment and signing a $180,000 note payable for the balance. Murphy also had to pay delinquent property tax of $2,500, title insurance costing $5,500, and $5,000 to level the land and remove an unwanted building. The company paid $54,000 to add soil for the foundation and then constructed an office building at a cost of $750,000. It also paid $51,000 for a fence around the property, $11,000 for the company sign near the property entrance, and $2,000 for lighting of the grounds. What is the capitalized cost of each of Murphy?s land, land improvements, and building?

 

Paper#80668 | Written in 18-Jul-2015

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