Question - Walt Inc. acquired Sam Company on January 1, 2006. When the purchase occurred Sam Company had the following information related to fixed
assets:
Land 80,000
Building 200,000
Accumulated Depreciation (100,000)
Equipment 100,000
Accumulated Depreciation (50,000)
The building has a 10-year remaining useful life and the equipment has a 5-year remaining useful life.
The fair value of the assets on that date were:
Land 100,000
Building 130,000
Equipment 75,000
What is the 2006 depreciation expense Walt will record related to purchasing Sam Company?
a. $8,000
b. $15,000
c. $28,000
d. $30,000