A Your company has purchased a large new tractor trailer truck (heavy-duty truck). It has a basic cost of $180,000 with additional options costing $20,000, so the cost basis for depreciation purpose is $200,000. Its market value at the end of 5 years is estimated as $30,000 and it will be depreciated under the ADS with straight line depreciation. (A heavy-duty truck has life of 6 years under ADS, but assume 5 years for this problem.) (a) What is the cumulative depreciation through the end of the 3rd year? (b) What is the MACRS-ADS depreciation in the 4th year? (c) What is the book value at the end of the 2nd year?

Vaughn Manufacturing is considering the replacement of a piece of equipment with a newer model. The following data has been collected:   Old Equipment   New Equipment Purchase price $220500   $367500 Accumulated depreciation 88200   - 0 - Annual operating costs 294000   235200 If the old equipment is replaced now, it can be sold for $58800. Both the old equipment’s remaining useful life and the new equipment’s useful life is 5 years. The company uses straight-line depreciation with a zero salvage value for all of its assets.For the 5-year period, what is the increase or decrease in net income associated with the new equipment? $88200` $58800 $(14700) $(73500)

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XYZ bought an asset that cost $200,000 at the beginning of the year.  It has a salvage value of $30,000.  The useful life of the asset is 10 years.  How much will the company's total depreciation expense be over the asset's 10 year life? Group of answer choices $200,000 $170,000 $30,000 $20,000

Flingen Inc. reveals the following information in their annual report for FY 2021 Selected Income Statement Items: ​ Sales $10,500,000 Cost of goods sold $5,500,000 Pretax earnings $650,000 ​ ​ Selected Balance Sheet Items: ​ Merchandise inventory $800,000 Total assets $2,500,000 Upper management plans to cut cost of goods sold by 4.5% for the coming year but retain the same sales and weeks of inventory. What is the return on assets estimated to be for 2022? Group of answer choices 33.7% 32.1% 36.8% 34.1%

Q1) A catering company buys a delivery truck for $34000 for its everyday business. The lifetime of the truck is estimated Five years and the production life in Kilometers is 200 000 KM. The residual value at the end of its lifetime is $4000. The truck has the following production in five years. Year 1 30 000 KM Year 2 40 000 KM Year 3 50 000 KM Year 4 70 000 KM Year 5 10 000 KM Requirements: Compute the Depreciation Expense under the following methods. Double Declining Balance Method. Sum-of-year-digit Method

Your company is contemplating the purchase of a large stamping machine. The machine will cost $167,000. With additional transportation and installation costs of $5,000 and $11,000, respectively, the cost basis for depreciation purposes is $183,000. Its MV at the end of five years is estimated as $34,000. The IRS has assured you that this machine will fall under a three year MACRS class life category. The justifications for this machine include $45,000 savings per year in labor and $29,000 savings per year in reduced materials. The before-tax MARR is 24% per year, and the effective income tax rate is 28%. Assume the stamping machine will be used for only three years, owing to the company's losing several government contracts. The MV at the end of year three is $47,000. What is the income tax owed at the end of year three owing to depreciation recapture (capital gain)? E Click the icon to view the GDS Recovery Rates (rg) for the 3-year property class. Choose the correct answer below. O…

You purchased a stamping machine that cost $60,000 five years ago. At that time, the machine was estimated to have a service life of five years with salvage value of $5,000. These estimates are still good. The property has been depreciated according to a seven-year MACRS property class. Now (at the end of year 5 from purchase) you are considering selling the machine at $10,000. What book value should you use in determining the taxable gains?(a) $10,000(b) $13,386(c) $16,065(d) $17,520

Youngblood Shipbuilding Yard just purchased $800,000 in capital equipment for Ship-repairing functions on dry-docked ships. Estimated salvage is $150,000 for any year after 5 years of use. Compare the depreciation and book value for year 3 for each of the following depreciation methods:a. GDS MACRS where the recovery period is 10 yearsb. Double-declining balance with a recovery period of 15 years.c. ADS SL, as an alternative to MACRS, with a recovery period of 15 years

A tractor for over-the-road hauling is purchased for $80,000.00. It is expected to be of use to the company for 6 years, after whic will be salvaged for $3,200.00. Calculate the depreciation deduction and the unrecovered investment during each year of the tractors life. a. Use straight-line depreciation. Provide depreciation and book value for year 6. Depreciation for year 6 = $ book value for year 6 = $ b. Use declining-balance depreciation, with a rate that ensures the book value equals the salvage value. Provide depreciation and book value for year 6. Depreciation for year 6 = $ book value for year 6 = $ c. Use double declining balance depreciation. Provide depreciation and book value for year 6. Depreciation for year 6 = $ book value for year 6 = $ d. Use double declining balance, switching to straight-line depreciation. Provide depreciation and book value for year 6. Depreciation for year 6 = $ book value for year 6 = $ Do all computations to 5 decimal places and round final…