Calculate the annual Straight Line depreciation charge for a asset with a cost basis of $12,000,...
Calculate the annual Straight Line depreciation charge for a asset with a cost basis of $12,000, a depreciable life of 10 years, and a Salvage value of $2,000.
If you believe the useful life of an asset will be 10 years, the Bonus Depreciation method allows for 100% depreciation in year 1, and the MACRS method indicates the depreciable life is 7 years, what is the useful life you should use in capital recovery economic analysis? SHOW ALL CALCULATIONS
Homework Answers
The useful life to be considered for capital recovery economic analysis is 10 years as useful life according to MACRS is calculated for tax purpose, and the 100% depreciation allowed in the first year under bonus depreciation has no effect on choosing the useful life for this purpose.
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Calculate the annual Straight Line depreciation charge for a
asset with a cost basis of $12,000,...
Use straight line (SL) depreciation to determine a. annual depreciation charge (5 points) and b. annual...
Use straight line (SL) depreciation to determine a. annual depreciation charge (5 points) and b. annual book values for the life of the asset having the price of $1,900,000, depreciable life of 10 years, and the salvage value of $600,000. (10 points)
A company used straight-line depreciation for an item of equipment that cost $12,000, had a salvage value of $2,000 and...
A company used straight-line depreciation for an item of equipment that cost $12,000, had a salvage value of $2,000 and a five-year useful life. After depreciating the asset for three complete years, the salvage value was reduced to $1,200 but its total useful life remained the same. Determine the amount of depreciation to be charged against the equipment during each of the remaining years of its useful life: $2,000 $5,400 $1,000 $1,800 $2,400
According to straight-line depreciation, what is the annual depreciation allowance for the following asset? Cost of...
According to straight-line depreciation, what is the annual depreciation allowance for the following asset? Cost of asset is $10,000 Salvage is $3,000 Useful life of 20 years
Income statement: Depreciation: $135,663 Book depreciation is determined using straight-line method, a zero estimated residual value,...
Income statement: Depreciation: $135,663 Book depreciation is determined using straight-line method, a zero estimated residual value, and a full year of depreciation for the year of acquisition. Wildcat purchases and places into service the assets on Jan 1, 2018: Original Cost Estimated useful life MACRS recovery period Class life $ 350,627 8 years 7 years 12 years $ 1,102,023 12 years 5 years 9 years Wildcat does not use Sec. 179 or bonus depreciation. What is the the taxable depreciation?...
6. Depreciation methods Firms can use various methods to calculate depreciation, and it is important for...
6. Depreciation methods Firms can use various methods to calculate depreciation, and it is important for you to consider these different methods when evaluating firms. The impact of different depreciation methods is stronger for asset-intensive firms. Major factors that affect the depreciation of a fixed asset include the purchase cost, residual/salvage value, and estimated useful life of the asset. The purchase cost includes the asset's explicit cost plus necessary costs associated with setting up and operating the asset (such as...
*THIS IS ONE QUESTION ONLY* Basic depreciation concepts Cost or factor depletion is based on _____________ level, not time as used in depreciation. The remaining, undepreciated amount of an...
*THIS IS ONE QUESTION ONLY*
Basic depreciation concepts
Cost or factor depletion is based on _____________ level, not
time as used in depreciation.
The remaining, undepreciated amount of an investment is known as
its ____________.
Percentage depletion is determined as a stated percentage
times___________.
The depreciable life of an asset is also known as the
_____________.
MACRS depreciation rates always write-off the asset's value to
_____________.
In the straight line method of depreciation, the depreciation
charge in the final year...
Calculator The calculation for annual depreciation using the straight-line depreciation method is a. Depreciable Cost/Estimated Useful...
Calculator The calculation for annual depreciation using the straight-line depreciation method is a. Depreciable Cost/Estimated Useful Life b. Depreciable Cost * Estimated Useful Life c. Initial Cost/Estimated Useful Life Od. Initial Cost Estimated Useful Life
12. A company used straight-line depreciation for an item of equipment that cost $19,000, had a...
12. A company used straight-line depreciation for an item of equipment that cost $19,000, had a salvage value of $2,000, and had a 8-year useful life. After depreciating the asset for 2 complete years, the salvage value was reduced to $1,400 and its total useful life was increased from 8 years to 10 years. Determine the amount of depreciation to be charged against the machine during each of the remaining years of its useful life (round depreciation per year to...
14.1 Using the Straight Line (SL) depreciation method, what is the (a) annual depreciation charge, Dt=?,...
14.1 Using the Straight Line (SL) depreciation method, what is the
(a) annual depreciation charge, Dt=?, (b) the total accumulated
depreciation charge, D4=? , at the end of year 4, and (c) the book
value, BV=? , at the end of year 4, for an automobile with a
Five-year useful life that has a first cost of $19,657 and an
$8,418.40 salvage value?
14.1 Using the Straight Line (SL) depreciation method, what is the (a) annual depreciation charge, DF?, (b)...
Using the Straight Line (SL) depreciation method, what is the (a) annual depreciation charge, Dt=?, (b)...
Using the Straight Line (SL) depreciation method, what is the (a) annual depreciation charge, Dt=?, (b) the total accumulated depreciation charge, D3=?, at the end of year 3, and (c) the Book Value, BV3=?, at the end of year 3, for an automobile with a five-year useful life that has a first cost of $20,200 and an $8,565.00 salvage value?
Use straight line (SL) depreciation to determine a. annual depreciation charge (5 points) and b. annual book values for the life of the asset having the price of $1,900,000, depreciable life of 10 years, and the salvage value of $600,000. (10 points)
6. Depreciation methods Firms can use various methods to calculate depreciation, and it is important for you to consider these different methods when evaluating firms. The impact of different depreciation methods is stronger for asset-intensive firms. Major factors that affect the depreciation of a fixed asset include the purchase cost, residual/salvage value, and estimated useful life of the asset. The purchase cost includes the asset's explicit cost plus necessary costs associated with setting up and operating the asset (such as...
*THIS IS ONE QUESTION ONLY*
Basic depreciation concepts
Cost or factor depletion is based on _____________ level, not
time as used in depreciation.
The remaining, undepreciated amount of an investment is known as
its ____________.
Percentage depletion is determined as a stated percentage
times___________.
The depreciable life of an asset is also known as the
_____________.
MACRS depreciation rates always write-off the asset's value to
_____________.
In the straight line method of depreciation, the depreciation
charge in the final year...
Calculator The calculation for annual depreciation using the straight-line depreciation method is a. Depreciable Cost/Estimated Useful Life b. Depreciable Cost * Estimated Useful Life c. Initial Cost/Estimated Useful Life Od. Initial Cost Estimated Useful Life
14.1 Using the Straight Line (SL) depreciation method, what is the
(a) annual depreciation charge, Dt=?, (b) the total accumulated
depreciation charge, D4=? , at the end of year 4, and (c) the book
value, BV=? , at the end of year 4, for an automobile with a
Five-year useful life that has a first cost of $19,657 and an
$8,418.40 salvage value?
14.1 Using the Straight Line (SL) depreciation method, what is the (a) annual depreciation charge, DF?, (b)...
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