ACC 201 Lecture Notes - Lecture 9: Income Statement

• School: Elon University
• Department: Accounting
• Course: ACC 201
• Professor: Hani Tadros

Document Summary

3/27-3/31: acquisitions of lt assets, use of lt assets, disposal of lt assets, expenditures after acquisition, intangible assets. Tangible: property, plant, and equipment (ppe) Capitalize: adds value, better engine in company vehicle, costs incurred readying an asset for use, clearing newly purchased land, record expenditure in an asset account, balance sheet. Expense: maintains value, oil change on company vehicle, record expenditure in an expense account, income statement, acquisition cost of land. Capitalizations include: purchase price, sales taxes, realtor commission, cleaning and grading, removal of old building (cid:1855)(cid:1869). (cid:1829)(cid:1867)(cid:1871)(cid:1872) (cid:1867)(cid:1858) (cid:1866)(cid:1856)=(cid:890),(cid:887)(cid:882)(cid:882)+,(cid:886)(cid:882)(cid:882)+,(cid:882)(cid:890)(cid:882)+,(cid:890)(cid:882)(cid:882)+,(cid:882)(cid:882)(cid:882)=(cid:889),(cid:889)(cid:890)(cid:882, acquisition cost of equipment. Capitalizations include: purchase price, (early payment discount, sales tax, freight costs, instillation. Close out ppe account by crediting original purchase price to cancel debit. Accumulated depreciation cancelled by payment for property. If you lose money on the sale, record in the shareholder equity. Building - ,000 (80% of ,000: (cid:1830)(cid:1857)(cid:1868). (cid:1831)(cid:1876)(cid:1868). = (cid:2876),(cid:2868)(cid:2868)(cid:2868) (cid:2870),(cid:2868)(cid:2868)(cid:2868) Asset is never worth zero, rather value is halved every year.