Answer each of the following questions. Assume the asset was purchased at the beginning of the year. 1. A plant asset purchased for $550,000 has an estimated life of 10 years and a residual value of $27,500. Depreciation for the second year of use, determined by the declining-balance method at twice the straight-line rate is $ 2. A plant asset...
1. When the expected cost to dismantle and remove an asset exceeds the expected selling price of a depreciable asset, the difference is A. added to cost to determine the depreciable base B. deducted from accumulated depreciation in the year of disposal C. not included in the calculation of depreciation expense D. added to the depreciation expense in the year...
QUESTION 2 A machine with a four-year estimated useful life and an estimated residual value of $10,000 was acquired on January 1, 2011 for $40,000. Would depreciation expense using sum-of-the-years-digits be higher or lower than depreciation expense using double-declining balance in the first year? Higher Lower Cannot answer based on only this information QUESTION 3 On January 1, 2011, New...
At December 31, 2020, Cord Company's plant asset and accumulated depreciation and amortization accounts had balances as follows: Category Plant Asset Accumulated Depreciation and Amortization Land $ 185,000 $ — Buildings 2,000,000 338,900 Equipment 1,625,000 327,500 Automobiles and trucks 182,000 110,325 Leasehold improvements 236,000 118,000 Land improvements — — Depreciation methods and useful lives: Buildings—150% declining balance; 25 years. Equipment—Straight...
Problem 9-15A Partial-period depreciation; disposal of PPE LO2, 3, 6Endblast Productions showed the following selected asset balances on December 31, 2020: Land$432,800Building562,400Accumulated depreciation, building1408,000Equipment189,200Accumulated depreciation, equipment280,0001Remaining estimated useful life is eight years with a residual value of $20,000; depreciated using the straight-line method to the nearest whole month.2Total estimated useful life is 10 years with a residual value of $24,000; depreciated...
On July 1, 2016, Alpha Company purchased for $76,000, equipment having a service life of eight years and an estimated residual value of $4,000. Alpha has recorded depreciation of the equipment using the double-declining balance method. On December 31, 2018, before making any annual adjusting entries, the equipment was exchanged for new machinery having a fair value of $35,000. The...
Required information [The following information applies to the questions displayed below.) Manrow Growers, Inc., owns equipment for sowing and harvesting its organic fruit, vegetables, and tree nuts that are sold to local restaurants and grocery stores. At the beginning of 2019, an asset account for the company showed the following balances: Equipment Accumulated depreciation through 2018 $ 420,000 231,600 During...
On March 31, 2021, the Herzog Company purchased a factory complete with vehicles and equipment. The allocation of the total purchase price of $1,000,000 to the various types of assets along with estimated useful lives and residual values are as follows: Asset Cost Estimated Residual Value Estimated Useful Life (in years) Land 100,000 N/A N/A Building 500,000 None 25 Equipment...
Instrucions The following transactions and adjusting entries were completed by Legacy Furniture Co. during a three-year period. All are related to the use of delivery equipment. The double-declining-balance method of depreciation is used. Year 1 Jan. 4 Purchased a used delivery truck for $28,400, paying cash. Paid garage $710 for miscellaneous repairs to the truck Νov 2 Recorded depreciation on...
Arcadia HS, purchased equipment for $510,000 which was estimated to have a useful life of 10 years with a residual value of $10,000 at the end of that time. Depreciation has been recorded for 7 years on a straight-line basis. In 2014 (year 8), it is determined that the total estimated life should be 15 years with a residual value...