Homework Answers
Option C is the answer
.
As per matching principle of accounting, all the expenses are to be matched with the revenues it helped generate. The operational asset purchased will help the company in generating revenues. This will decrease the operational efficiency of the asset in the future. This has to be charged in the form of expense. Therefore the asset is charged with depreciation expense over all its useful life.
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Tangier Company paid cash to purchase a long-term operational asset. The cost of the asset will...
Chapter 8: Accounting for Long-Term Operational Assets Basket Purchase Allocation, Depreciation, Gain Loss on Sale. Bishop...
Chapter 8: Accounting for Long-Term Operational Assets Basket Purchase Allocation, Depreciation, Gain Loss on Sale. Bishop Enterprises purchased land, a building, and some equipment on January 1, 2018 for $400,000. An appraiser valued the land at $50,000, the building at $350,000, and the equipment at $100,000. The building has a useful life of 20 years and the company expects the residual value to be $30,000. The equipment has a useful life of 5 years with an expected residual value of...
29. Losses on the sale of long-term assets for cash: A. Are the excess of the...
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Colvin Enterprises purchased a depreciable asset on October 1, Year 1 at a cost of $148,000....
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Colvin Enterprises purchased a depreciable asset on October 1. Year 1 at a cost of $116,000....
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Chapter 8: Accounting for Long-Term Operational Assets Basket Purchase Allocation, Depreciation, Gain Loss on Sale. Bishop Enterprises purchased land, a building, and some equipment on January 1, 2018 for $400,000. An appraiser valued the land at $50,000, the building at $350,000, and the equipment at $100,000. The building has a useful life of 20 years and the company expects the residual value to be $30,000. The equipment has a useful life of 5 years with an expected residual value of...
29. Losses on the sale of long-term assets for cash: A. Are the excess of the book value over the cash received B. Are recorded as a credit. C. Are reported on a net-of-tax basis if material. D. Are the excess of the cash received over the book value. 30. Which of the following best describes the objective of depreciation? A. To allocate the cost of a long-term asset to an expense over its service life. B. To estimate the...
Beckman Enterprises purchased a depreciable asset on October 1. Year 1 at a cost of $100.000. The asset is expected to have a salvage value of $15.000 at the end of its five-year useful life. If the asset is depreciated on the double-declining-balance method, the asset's book value on December 31. Year 2 will be: Multiple Choice $18,360 $21,600 $27540 $54,000 $90,000
Brown Company paid cash to purchase the assets of Coffee Company on January 1, 2019. Information is as follows: Total cash paid $3.500.000 Assets acquired: Land S600.000 Building 5500.000 Machinery Ss00.000 Patents 3600,000 The building is depreciated using the double-declining balance method. Other information is: Salvage value 550.000 Estimated useful life in years The machinery is depreciated using the units-of-production method Other information is: Salvage value, percentage of cost 1096 Estimated total production output in 200.000 Actual production in units...
Colvin Enterprises purchased a depreciable asset on October 1, Year 1 at a cost of $148,000. The asset is expected to have a salvage value of $16,200 at the end of its five year useful life. If the asset is depreciated on the double declining balance method, the asset's book value on December 31, Year 2 will be Multiple Choice O $43,092 O $31968 $79.920 $133 200 $28,728
Colvin Enterprises purchased a depreciable asset on October 1. Year 1 at a cost of $116,000. The asset is expected to have a salvage value of $15,400 at the end of its five year useful life. If the asset is depreciated on the double-declining balance method, the asset's book value on December 31, Year 2 will be: Multiple Choice Ο $104,400 Ο $62640 Ο $25,056 Ο $32724 Ο $21,816
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