Depreciation Expense?
Calculate amount of revenue of expense that should be recognized on the income statement for the company year end Dec 31, 2009. I figured out all parts but the last one which is.. The net book value of buildings increased by $125k, no buildings were sold, and a new building costing $210k was purchased. How much is the depreciation expense? Please help! Thank you!
More Questions From This User See All
Answers & Comments
Verified answer
Increase in value of $125,000, no sales on buildings. New building cost 210,000.
So the part you need to figure out is the new building for depreciation expense of $210,000. the problem has to state how many years and how it was depreciated. Don't worry about the value increase in buildings. When the buildings are purchased, depreciation begins and shouldn't change the value unless something happens like fire, destruction, sale, etc.
you bought a bldg in 2009?
you determine the value of the bldg(not land) and establish a depreciation for that amount
you can probably find some depreciation schedules under that title at www.irs.gov
there are several methods, and of course, there a different lifetimes of different properties and also when it was purchased during the year,you don't give enough information here to tell you what it will be