lOMoARcPSD|46240884
Larson 17ce V2 SAIT Solutions CH09
Intermediate Financial Accounting I (Southern Alberta Institute of Technology)
Scan to open on Studocu
Studocu is not sponsored or endorsed by any college or university
Downloaded by damaris mutuli ()
, lOMoARcPSD|46240884
Last revised: September 2021
SOLUTIONS MANUAL
to accompany
Fundamental Accounting Principles
17thCanadian Edition
by Larson/Dieckmann/Harris
Revised for the 17th Edition by:
John Harris, Seneca College
Technical checks by: Rhonda Heninger, SAIT
Solutions Manual to accompany Fundamental Accounting Principles, 17th Canadian Edition. © 2022
McGraw Hill Ltd. 9-1
Downloaded by damaris mutuli ()
, lOMoARcPSD|46240884
Last revised: September 2021
Chapter 9 Property, Plant and Equipment and Intangibles
EXERCISES
Exercise 9-1 (10 minutes)
Invoice cost $28,000
Freight costs 450
Steel mounting 985
Assembly 660
Raw materials for testing 310
Less: discount ($28,000 × 1%) (280)
Total acquisition costs $30,125
Note: The $380 repairs are an expense and therefore not capitalized.
Note: The special insurance is an expense and therefore not capitalized.
Solutions Manual to accompany Fundamental Accounting Principles, 17th Canadian Edition. © 2022
McGraw Hill Ltd. 9-2
Downloaded by damaris mutuli ()
, lOMoARcPSD|46240884
Last revised: September 2021
Exercise 9-3 (15 minutes)
Allocation of total cost:
(a) (b) (c)
Ratio of Individual Appraised Value
PPE Asset Appraised to Total Appraised Value Cost Allocation
Values (a) Total Appraised Value (b) x Total Actual Cost
Land $249,480 249,480 594,000 = .42 or 42% $ 244,3462
Land Imprv. 83,160 83,160 594,000 = .14 or 14% 81,4483
Building 261,360 261,360 594,000 = .44 or 44% 255,9814
Totals $594,000 $ 581,7751
1. 552,375 + 29,400 = 581,775
2. 42% x 581,775 = 244,346
3. 14% x 581,775 = 81,448
4. 44% x 581,775 = 255,981
Journal entry:
2023
Apr. 12 Land..................................................................................... 244,346
Land Improvements.............................................................. 81,448
Building................................................................................ 255,981
Cash.............................................................................. 581,775
To record costs of lump-sum purchase.
Solutions Manual to accompany Fundamental Accounting Principles, 17th Canadian Edition. © 2022
McGraw Hill Ltd. 9-3
Downloaded by damaris mutuli ()
Larson 17ce V2 SAIT Solutions CH09
Intermediate Financial Accounting I (Southern Alberta Institute of Technology)
Scan to open on Studocu
Studocu is not sponsored or endorsed by any college or university
Downloaded by damaris mutuli ()
, lOMoARcPSD|46240884
Last revised: September 2021
SOLUTIONS MANUAL
to accompany
Fundamental Accounting Principles
17thCanadian Edition
by Larson/Dieckmann/Harris
Revised for the 17th Edition by:
John Harris, Seneca College
Technical checks by: Rhonda Heninger, SAIT
Solutions Manual to accompany Fundamental Accounting Principles, 17th Canadian Edition. © 2022
McGraw Hill Ltd. 9-1
Downloaded by damaris mutuli ()
, lOMoARcPSD|46240884
Last revised: September 2021
Chapter 9 Property, Plant and Equipment and Intangibles
EXERCISES
Exercise 9-1 (10 minutes)
Invoice cost $28,000
Freight costs 450
Steel mounting 985
Assembly 660
Raw materials for testing 310
Less: discount ($28,000 × 1%) (280)
Total acquisition costs $30,125
Note: The $380 repairs are an expense and therefore not capitalized.
Note: The special insurance is an expense and therefore not capitalized.
Solutions Manual to accompany Fundamental Accounting Principles, 17th Canadian Edition. © 2022
McGraw Hill Ltd. 9-2
Downloaded by damaris mutuli ()
, lOMoARcPSD|46240884
Last revised: September 2021
Exercise 9-3 (15 minutes)
Allocation of total cost:
(a) (b) (c)
Ratio of Individual Appraised Value
PPE Asset Appraised to Total Appraised Value Cost Allocation
Values (a) Total Appraised Value (b) x Total Actual Cost
Land $249,480 249,480 594,000 = .42 or 42% $ 244,3462
Land Imprv. 83,160 83,160 594,000 = .14 or 14% 81,4483
Building 261,360 261,360 594,000 = .44 or 44% 255,9814
Totals $594,000 $ 581,7751
1. 552,375 + 29,400 = 581,775
2. 42% x 581,775 = 244,346
3. 14% x 581,775 = 81,448
4. 44% x 581,775 = 255,981
Journal entry:
2023
Apr. 12 Land..................................................................................... 244,346
Land Improvements.............................................................. 81,448
Building................................................................................ 255,981
Cash.............................................................................. 581,775
To record costs of lump-sum purchase.
Solutions Manual to accompany Fundamental Accounting Principles, 17th Canadian Edition. © 2022
McGraw Hill Ltd. 9-3
Downloaded by damaris mutuli ()
