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Sandhill Industries Corp. purchased the following assets and also constructed a building. All this was done during the current year. Assets 1 and 2 These assets were purchased together for $119,000 cash. The following information was gathered: Depreciation Initial Cost on to Date on Book Value on Appraised Description Seller's Books Seller's Books Seller's Books Value Machinery $112,000 $52,000 $60,000 $108,000 Office Equipment 65,000 10,000 55,000 36,000 Asset 3 This machine was acquired by making a $10,400 down payment and issuing a $34,200, two-year, zero-interest- bearing note. The note is to be paid off in two $17,100 instalments made at the end of the first and second years. It was determined that the asset could have been purchased outright for $35,700. Asset 4 A truck was acquired by trading in an older truck that has the same value in use. The newer truck has options that will make it more comfortable for the driver; however, the company remains in the same economic position after the exchange as before. Facts concerning the trade-in are as follows: Cost of truck traded $105,000 Accumulated depreciation to date of sale 42,000 Fair market value of truck traded 83,000 Cash paid by Sandhill 10,200 Fair market value of truck acquired 69,000 Asset 5 Office equipment was acquired by issuing 120 common shares. The shares are actively traded and had a closing market price a few days before the office equipment was acquired of $12 per share. Alternatively, the office equipment could have been purchased for a cash price of $1,415. Construction of Building A building was constructed on land that was purchased on January 1 at a cost of $152,000. Construction began on February 1 and was completed November 1. The payments to the contractor were as follows: Date Payment Feb. 1 $125,000 June 1 352,000 Sept. 1 486,000 Nov. 1 110,000 To finance construction of the building, a $601,000, 12% construction loan was taken out on February 1. At the beginning of the project, Sandhill invested the portion of the construction loan that was not yet expended and earned investment income of $4,200. The loan was repaid on November 1 when the construction was completed. The firm had $207,000 of other outstanding debt during the year at a borrowing rate of 9% and a $203,000 loan payable outstanding at a borrowing rate of 6%. Sandhill uses a variety of alternatives to finance its acquisitions. Record the acquisition of each of these assets, assuming that Sandhill prepares financial statements in accordance with IFRS. Use the net amount to record the note. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter o for the amounts. Round capitalization rate to 2 decimal places, e.g. 52.75% and final answers to o decimal places, e.g. 5,275.) Account Titles and Explanation Debit Credit Acquisition of Assets 1 and 2 Machinery 89250 Equipment 29750 Cash 119000 Acquisition of Asset 3 Machinery 35700 Notes Payable 25300 Cash 10400 Acquisition of Asset 4 Loss on Disposal of Machinery 52800 Accumulated Depreciation - Trucks 42000 Cash 10200 Machinery 105000 Acquisition of Asset 5 Equipment 1440 Common Shares HOU OU VODI Hou by Jill 14401 Const tion of Building Land 152000 Buildings > Cash Interest Expense

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