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- Equipment was purchased for $120,000 on March 1, 2016. Its estimated useful life is eight years with a $12,000 expected salvage value. Using double-declining balance depreciation, the 2017 depreciation expense is: A) $22,500 B) $27,000 C) $23,750A machine which cost $500,000 is acquired on October 1, 2017. Its estimated salvage value is $50,000 and its expected life is eight years. Instructions Calculate depreciation expense for 2017 and 2018 by each of the following methods, showing the figures used.Novak Corporation purchased machinery on January 1, 2017, at a cost of $270,000. The estimated useful life of the machinery is 4 years, with an estimated salvage value at the end of that period of $24,000. The company is considering different depreciation methods that could be used for financial reporting purposes. Prepare separate depreciation schedules for the machinery using the straight-line method, and the declining-balance method using double the straight-line rate. STRAIGHT-LINE DEPRECIATION Computation End of Year Years Depreciable Cost x Depreciation Rate = Annual Depreciation Expense Accumulated Depreciation Book Value 2017 $ $1 2$ 2018 2019 % 2020 % DOUBLE-DECLINING-BALANCE DEPRECIATION Computation End of Year Years Book Value Beginning of Year x Depreciation Rate = Annual Depreciation Expense Accumulated Depreciation Book Value 2017 $ 2018 2019 2020 9,750 * Depreciation expense for 2020 under Double declining-balance is adjusted so that ending book value is equal to salvage…
- Five Satins Company purchased a piece of equipment at the beginning of 2017. The equipment cost $430,000. It has an estimated service life of 8 years and an expected salvage value of $70,000. The sum-of-the-years’-digits method of depreciation is being used. Someone has already correctly prepared a depreciation schedule for this asset. This schedule shows that $60,000 will be depreciated for a particular calendar year. Instructions Show calculations to determine for what particular year the depreciation amount for this asset will be $60,000.A machine which cost $500,000 is acquired on October 1, 2017. Its estimated salvage value is $50,000 and its expected life is eight years. Instructions Calculate depreciation expense for 2017 and 2018 by each of the following methods, showing the figures used. (3a) Double-declining balance (3b) Sum-of-the-years'-digitsClean Corporation purchased a depreciable asset for $1,560,000 on January 1, 2015. The estimated salvage value is $120,000, and the estimated useful life is 9 years. The straight-line method is used for depreciation. On January 1, 2018, Hollander changed its estimates to a total remaining useful life of 8 years with a salvage value of $200,000. What is 2018 depreciation expense? A) $160,000 OB) $200,000 C) $240,000 D) $110,000
- Machinery purchased for $ 74,400 by Splish Co. in 2016 was originally estimated to have a life of 8 years with a salvage value of $ 4,960 at the end of that time. Depreciation has been entered for 5 years on this basis. In 2021, it is determined that the total estimated life should be 10 years with a salvage value of $ 5,580 at the end of that time. Assume straight-line depreciation. Prepare the entry to correct the prior years' depreciation, if necessary. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)Machinery purchased for $ 74,400 by Splish Co. in 2016 was originally estimated to have a life of 8 years with a salvage value of $ 4,960 at the end of that time. Depreciation has been entered for 5 years on this basis. In 2021, it is determined that the total estimated life should be 10 years with a salvage value of $ 5,580 at the end of that time. Assume straight-line depreciation. Prepare the entry to correct the prior years' depreciation, if necessary. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Prepare the entry to record depreciation for 2021. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. Use Machinery related account.)Frey, Inc. purchased a machine for $600,000 on January 2, 2017. The machine has an estimated useful life of 4 years and a salvage value of $100,000. The machine is being depreciated using the sum-of-the-years'-digits method. The December 31, 2018 asset balance, net of accumulated depreciation, should be: Select one: a. $250,000 Ob. $350,000 c. $280,000 Od. $320,000 $450,000
- Equipment was acquired on January 1, 2013, at a cost of $75,000. The equipment was originally estimated to have a salvage value of $5,000 and an estimated life of 10 years. Depreciation has been recorded through December 31, 2016, using the straight-line method. On January 1, 2017, the estimated salvage value was revised to $7,000 and the useful life was revised to a total of 8 years. (A) Calculate the book value at the time of the revision (January 1, 2017). (B) Determine the depreciation expense for 2017Mandall Company constructed a warehouse for $280,000 on January 2, 2017. Mandall estimates that the warehouse has a useful life of 20 years and no residual value. Construction records indicate that $40,000 of the cost of the warehouse relates to its heating, ventilation, and air conditioning (HVAC) system, which has an estimated useful life of only 10 years. What is the first year of depreciation expense using straightline component depreciation under IFRS?(a) $28,000. (c) $16,000.(b) $14,000. (d) $4,000A machine cost $900,000 on April 1, 2017. Its estimated salvage value is $90,000 and its expected life is eight years. Instructions (1) Calculate the depreciation expense (to the nearest dollar) by each of the following methods, showing the figures used. (a) Straight-line for 2017 (b) Double-declining balance for 2018 (c) Sum-of-the-years'-digits for 2018 (2) Which method would result in the smallest income amount for 2018? Callon Co. uses the composite method to depreciate its equipment. The following totals are for all of the equipment in the group: Initial Residual Depreciable Depreciation Cost Value Cost Per Year $1,000,000 $100,000 $900,000 $90,000 Instructions (a) What is the composite rate of depreciation? (To nearest tenth of a…