Question

Clipboard Font Alignment G32 fax H 1 с D E G 3 Using the worksheet below, complete the following: 4 5 1 Depreciation Expense per year 6 1 2 Accumulated Depreciation per year 8 9 3 Net Remaining Undepreciated Cost 10 12 Assumptions are as follows: 13 14 A Cost to be Depreciated 200,000 15 18 B Estimated useful life of the equipment 10 years 18 19 20 22 Year Cost to be Depreciation Accumulated Net Remaining Depreciated Exp Per Yr Depreciation Undepreciated Cost 23 24 25 25 1 2 3 4 5 28 29 6 7 InvTO Deprec Ready IH Type here to search O esc ? 12 14 45 a 1 # 2 $ 3 4. % 5 6 & 7

Answer 1

From the available information, the depreciation expense is calculated using the straight line depreciation method.

In straight line depreciation method, the depreciation expense remains constant throughout the estimated life of the asset. The formual for depreciation expense under straight line method is given below:

${\textrm{Depreciation expense}} = \frac{{\textrm{Cost of the asset}} }{{\textrm{Estimated useful life of the asset}}}$

Compute the depreciation expense:

Cost of the equipment Depreciation expense = Estimated life of the project $200,000 10 years = $20,000 =

The depreciation expense per year, the Accumualted depreciation expense per year, and the net remaining undepreciated cost is computed below:

B Year 1 с D E F Depreciation Net remaining Cost to be Accumulated expense per undepreciated depreciated depreciation year cost $ 200,000.00 $ 20,000.00 $ 20,000.00 $ 180,000.00 $ 200,000.00 $ 20,000.00 $40,000.00 $ 160,000.00 $ 200,000.00 $ 20,000.00 $ 60,000.00 $ 140,000.00 $ 200,000.00 $ 20,000.00 $80,000.00 $ 120,000.00 $ 200,000.00 $ 20,000.00 $ 100,000.00 $ 100,000.00 $ 200,000.00 $ 20,000.00 $ 120,000.00 $ 80,000.00 $ 200,000.00 $ 20,000.00 $ 140,000.00 $ 60,000.00 $ 200,000.00 $ 20,000.00 $ 160,000.00 $ 40,000.00 $ 200,000.00 $ 20,000.00 $ 180,000.00 $ 20,000.00 $ 200,000.00 $ 20,000.00 $ 200,000.00 $ 0.00 4 Nm in DN 00 10

The formula used for the above calculation is given below:

B с C D E F Year Cost to be depreciated Accumulated depreciation 1 200000 20000 2 200000 3 200000 4 200000 Depreciation expense per year =C2/10 =C3/10 =C4/10 =C5/10 =C6/10 =C7/10 =C8/10 =C9/10 =C10/10 =C11/10 Сл Net remaining undepreciated cost =C2-E2 =C3-E3 =C4-E4 =C5-E5 =C6-E6 =C7-E7 =C8-E8 =C9-E9 = =C10-E10 =C11-E11 =E2+D3 =E3+D4 =E4+D5 =E5+D6 =E6+D7 =E7+D8 =E8+D9 = =E9+D10 200000 6 200000 200000 7 8 200000 9 200000 200000 10 =E10+D11