Homework Answers
Answer: Option ( A) Straight line
Explanation:
When an asset generate revenue evenly over time the appropriate depreciation method is straight line. Under straight line method Depreciation value up on asset will equal amount over life of the asset. The formula to calculate depreciation is
Straight line Depreciation = (Cost of the asset - Salvage value) / Life of the asset
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When an asset generates revenue evenly over time the appropriate depreciation method is: Straight-line Double declining...
The following table demonstrates the double-declining balance method for the same asset. The depreciation rate is...
The following table demonstrates the double-declining balance method for the same asset. The depreciation rate is equal to double the depreciation rate for the straight-line method. The annual depreciation in the straight-line method is $2,000. Therefore the depreciation rate is $2,000 divided by $10,000, which is 20%. In the double-declining balance method this rate is doubled to 40%. Fill up the blanks. Year Book value (start of year) Depreciation Rate Depreciation expense Accumulated Depreciation Book value (year end) 1 10000 40%...
1. Straight-Line Depreciation Year Expense 2015 $ 2016 2017 2018 2019 2. Double-declining balance (Round answers...
1. Straight-Line Depreciation Year Expense 2015 $ 2016 2017 2018 2019 2. Double-declining balance (Round answers to the nearest whole number, when appropriate.) Depreciation Year Expense 2015 $ 2016 2017 2018 2019 Depreciation Methods On January 2, 2015, Roth, Inc. purchased a laser cutting machine to be used in the fabrication of a part for one of its key products. The machine cost $125,000, and its estimated useful life was four years or 1,200,000 cuttings, after which it could be...
Explain the 3 different methods of accounting for Depreciation. (Straight Line, Double Declining Balance, Units of Output...
Explain the 3 different methods of accounting for Depreciation. (Straight Line, Double Declining Balance, Units of Output or Production) Comment on the definition, calculation, journal entries, etc. of each method
Computing Straight Line and Double Declining-Balance Depreciation On January 2, Reed Company purchases a laser cutting...
Computing Straight Line and Double Declining-Balance Depreciation On January 2, Reed Company purchases a laser cutting machine for use in fabrication of a part for one of its key products. The machine cost $75.000, and its estimated useful life is five years, after which the expected salvage value is $5.000. For both parts cal and (b) below: (1) Compute depreciation expense for each year of the machine's five year useful life under that depreciation method. 2 Use the financial Statements...
Straight-Line Depreciation Rates Convert each of the following estimates of useful life to a straight-line depreciation...
Straight-Line Depreciation Rates Convert each of the following estimates of useful life to a straight-line depreciation rate, stated as a percentage, assuming that the residual value of the fixed asset is to be ignored: (a) 4 years, (b) 8 years, (c) 10 years, (d) 16 years, (e) 25 years, (f) 40 years, (g) 50 years. If required, round your answers to two decimal places. Years Percentage 4 years 8 years 10 years 16 years 25 years 40 years 50 years...
1. Identify for each of the three major methods of calculating depreciation (Straight-Line, Double Declining Balance,...
1. Identify for each of the three major methods of calculating depreciation (Straight-Line, Double Declining Balance, Units of Production), a company that would likely use that method. Why would that company choose that specific method?
The most widely used depreciation method for financial statements is 1) straight-line 2) MACRS O3) declining-balance...
The most widely used depreciation method for financial statements is 1) straight-line 2) MACRS O3) declining-balance O4) units-of-production The method of depreciation that yields a depreciation charge that varies with the amount of asset usage is known as the units-of-production method. True O False
Computing Straight-Line and Double-Declining-Balance Depreciation On January 2, Haskins Company purchases a laser cutting machine for...
Computing Straight-Line and Double-Declining-Balance Depreciation On January 2, Haskins Company purchases a laser cutting machine for use in fabrication of a part for one of its key products. The machine cost $85,000, and its estimated useful life is five years, after which the expected salvage value is $5,000. For both parts (a) and (b) below: (1) Compute depreciation expense for each year of the machine's five-year useful life under that depreciation method. (2) Use the financial statements effects template to...
1. Total depreciation expense over 5 years will be more with the double-declining balance method than...
1. Total depreciation expense over 5 years will be more with the double-declining balance method than with straight line method. a. True b. False 2. Once a company selects the depreciation method they want to use, it must use the same method for all subsequent fixed asset acquisitions. a. True b. False 3. Mitchell's Motors purchased equipment for $72,000 on January 1, 2018. The equipment is expected to have a five-year life and a residual value of $6,000. Using the...
Explain the difference between the straight line, double declining balance and the unit-of-production depreciation methods. Document...
Explain the difference between the straight line, double declining balance and the unit-of-production depreciation methods. Document the method used for each of the three companies (Pepsi,Coca-Cola and Dr Pepper Snapple).
1. Straight-Line Depreciation Year Expense 2015 $ 2016 2017 2018 2019 2. Double-declining balance (Round answers to the nearest whole number, when appropriate.) Depreciation Year Expense 2015 $ 2016 2017 2018 2019 Depreciation Methods On January 2, 2015, Roth, Inc. purchased a laser cutting machine to be used in the fabrication of a part for one of its key products. The machine cost $125,000, and its estimated useful life was four years or 1,200,000 cuttings, after which it could be...
Computing Straight Line and Double Declining-Balance Depreciation On January 2, Reed Company purchases a laser cutting machine for use in fabrication of a part for one of its key products. The machine cost $75.000, and its estimated useful life is five years, after which the expected salvage value is $5.000. For both parts cal and (b) below: (1) Compute depreciation expense for each year of the machine's five year useful life under that depreciation method. 2 Use the financial Statements...
Straight-Line Depreciation Rates Convert each of the following estimates of useful life to a straight-line depreciation rate, stated as a percentage, assuming that the residual value of the fixed asset is to be ignored: (a) 4 years, (b) 8 years, (c) 10 years, (d) 16 years, (e) 25 years, (f) 40 years, (g) 50 years. If required, round your answers to two decimal places. Years Percentage 4 years 8 years 10 years 16 years 25 years 40 years 50 years...
The most widely used depreciation method for financial statements is 1) straight-line 2) MACRS O3) declining-balance O4) units-of-production The method of depreciation that yields a depreciation charge that varies with the amount of asset usage is known as the units-of-production method. True O False
1. Total depreciation expense over 5 years will be more with the double-declining balance method than with straight line method. a. True b. False 2. Once a company selects the depreciation method they want to use, it must use the same method for all subsequent fixed asset acquisitions. a. True b. False 3. Mitchell's Motors purchased equipment for $72,000 on January 1, 2018. The equipment is expected to have a five-year life and a residual value of $6,000. Using the...
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