A company just bought a new machine for $100,000. It has no salvage value and useful...
A company just bought a new machine for $100,000. It has no salvage value and useful life of 5 years. Which method of depreciation would lead to a LOWER
amount of Net Income being reported in the first year?
A) Straight Line
B) Double Declining Balance
C) All of the above
Homework Answers
| Option B is the answer | |
| Double declining method is a depreciation method in which the asset is depreciated higher in the beginning years and it gradually decreases. As the asset is depreciated higher in the first year, net income will be lower |
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A new machine costs $42,000 and has a $2000 salvage value at the end of its 8-year useful life. Determine the straight-line (SL), and the double declining balance (DDB) depreciation schedules for the machine. (type PLZ)
On January 1,2018, a machine was purchased for $100,000. The machine has an estimated salvage value...
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salvage value 10,000
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On January 4, 2019, Columbus Company purchased new equipment for $693,000 that had a useful life...
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Required:
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accumulated depreciation for the first three years of the asset’s
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On January 1,2018, a machine was purchased for $100,000. The machine has an estimated salvage value of $5,920 and an estimated useful life of 5 years. The machine can operate for 112,000 hours before it needs to be replaced. The company closed its books on December 31 and operates the machine as follows: 2018, 22,400 hrs; 2019, 28,000 hrs; 2020, 16,800 hrs; 202 1, 33,600 hrs; and 2022, 11,200 hrs. (a) Compute the annual depreciation charges over the machine's life...
machine 1:
cost 76,000
salvage value 6,000
useful life 10 years
purchased 7/1/16
machine 2:
cost 80,000
salvage value 10,000
useful life 8 years
purchased 1/1/13
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cost 78,000
salvage value 6,000
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On January 4, 2019, Columbus Company purchased new equipment for
$693,000 that had a useful life of four years and a salvage value
of $53,000.
Required:
Prepare a schedule showing the annual depreciation and end-of-year
accumulated depreciation for the first three years of the asset’s
life under the straight-line method, the sum-of-the-years’-digits
method, and the double-declining-balance method.
Analyze:
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life. Actual production would be 40,000 units per year for all five
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The company uses the double-declining-balance method of
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50 Cast Salvage value Depreciable cost...
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