60.1K

Verified Solution

Link Copied!

During $2021,$ Lee's Book Store paid $$273,000$ for land and built a store in Miami, Florida. Prior to construction, the city of Miami charged Lee's $$1,800$ for a building permit, which Lee's paid. Lee's also paid $$15,800$ for architect's fees. The construction cost of $$710,000$ was financed by a long$-$term note payable, with interest costs of $$30,180$ paid at the completion of the project. The building was completed June $30,2021.$ Lee's depreciates the building using the straight$-$line method over $35$ years, with estimated residual value of $$341,000.$

Read the requirements.

Requirements

c$.$ Journalize depreciation on the building for $2021.$

Journal Entry

$\backslash$table$[[$Date$,$Accounts,Debit,Credit$],[,$Depreciation Expense$-$Building,$5,9,],[,$Accumulated Depreciation$-$Building,,$5,954]]$

Requirement $2.$ Report Lee's plant assets on the company's balance sheet at December $31,2021$

Batance Sheet

Plant assets:

Less:

Journalize transactions for the following $($explanations are not required$)$:

a$.$ Purchase of the land

b$.$ All the costs chargeable to the building in a single entry

c$.$ Depreciation on the building for $2021$

Report Lee's plant assets on the company's balance sheet at December $31,2021.$

What will Lee's income statement for the year ended December $31,2021,$ report for these facts?

Answer & Explanation Solved by verified expert

See Answer