Each of 8 students wishes to buy a particular textbook, but only 5 textbooks are available. How could one express the number of ways those textbooks could be distributed among the students?

Sahia Company

1. Net book value of the property at the end of year 2 = $217,800.

2. Journal entry to record the purchase:

Debit Property (land and building) $241,000

Credit Cash Account $241,000

To record the acquisition of the property.

3. Straight-line depreciation (on building only) = $11,600.

Explanation:

a) Data and Calculations:

Bought building for cash = $90,000

Bought land for cash =         110,000

Transfer cost =                       10,000

Renovation on building =      31,000

Book value of property =  $241,000

Depreciation:

Building cost = $90,000

Transfer cost        4,500 ($10,000*90,000/200,000)

Renovation         31,000

Total cost =    $125,500

Residual value     9,000

Depreciable value = $116,000

Depreciation per annum = $11,600 ($116,000/10)

a) Land is not subject to depreciation and its value is $115,500 or $110,000 + 5,500 ($10,000*110,000/200,000).

b) The net book value of the property at the end of year 2 is

Building $125,500 - 23,200 = $102,300

Land =                                          115,500

Net book value of property =  $217,800