FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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- Determine the machine's second-year depreciation and year end book value under the straight-line method. Straight-Line Depreciation Choose Numerator: / Choose Denominator: = Annual Depreciation Expense = Depreciation expense Year 2 Depreciation nces Year end book value (Year 2) =arrow_forwardH1.arrow_forwardPS Required: 1-a. Allocate the lump-sum purchase price to the separate assets purchased. 1-b. Prepare the journal entry to record the purchase. 2. Compute the first-year depreciation expense on the building using the straight-line method, assuming a 15-year life and a $32,000 salvage value. Timberly Construction makes a lump-sum purchase of several assets on January 1 at a total cash price of $800,000. The estimated market values of the purchased assets are building, $537,300; land, $318,400; land improvements, $39,800; and four vehicles, $99,500. 3. Compute the first-year depreciation expense on the land improvements assuming a five-year life and double-declining-balance depreciation. Complete this question by entering your answers in the tabs below. Required 1A Allocate the lump-sum purchase price to the separate assets purchased. Allocation of total cost Building Land Required 1B Required 2 Land improvements Vehicles Total Required 3 Estimated Market Value Percent of Total % % % % %…arrow_forward
- An asset was purchased for $112,000 on January 1, Year 1 and originally estimated to have a useful life of 11 years with a residual value of $10,000. At the beginning of the third year, it was determined that the remaining useful life of the asset was only 4 years with a residual value of $3,000. Calculate the third-year depreciation expense using the revised amounts and straight-line method. a.$22,613.64 b.$23,113.64 c.$23,613.64 d.$21,613.64arrow_forwardDepreciation by Two Methods A storage tank acquired at the beginning of the fiscal year at a cost of $95,000 has an estimated residual value of $6,000 and an estimated useful life of 20 years. a. Determine the amount of annual depreciation by the straight-line method. b. Determine the amount of depreciation for the first and second years computed by the double-declining-balance method. Do not round the double-declining balance rate. If required, round your answers to the nearest dollar.arrow_forwardAn asset, with a useful life of 10 years, wasacquired at the beginning of year 1 at a cost of $60 000. The asset is revalued at the beginning ofyear 4 in terms of the entitys revaluation policyto gross replacement cost of $ 80 000 at this date.Assume that depreciation calculated foraccounting purposes on the straight-line methodaccurately reflects economic obsolescence. What is the revaluation amount?arrow_forward
- Equipment was acquired at the beginning of the year at a cost of $625,000. The equipment was depreciated using the straight-line method based on an estimated useful life of 9 years and an estimated residual value of $46,635. a. What was the depreciation for the first year? Round your answer to the nearest cent.$ b. Using the rounded amount from Part a in your computation, determine the gain(loss) on the sale of the equipment, assuming it was sold at the end of year eight for $105,608. Round your answer to the nearest cent and enter as a positive amount.$ Loss c. Journalize the entry to record the sale. If an amount box does not require an entry, leave it blank. Round your answers to the nearest centarrow_forwardanswer correct step by step with all workarrow_forwardCalculate the total cost, total depreciation, and annual depreciation (in $) for the following assets by using the straight-line method. (Round your answers to the nearest cent.) Cost ShippingCharges SetupCharges TotalCost SalvageValue EstimatedUseful Life(years) TotalDepreciation AnnualDepreciation $76,400 $1,500 $750 $ $4,500 11 $ $arrow_forward
- Depreciation by Two Methods A storage tank acquired at the beginning of the fiscal year at a cost of $75,000 has an estimated residual value of $4,500 and an estimated useful life of five years. a. Determine the amount of annual depreciation by the straight-line method. b. Determine the amount of depreciation for the first and second years computed by the double-declining-balance method. Do not round the double-declining balance rate. If required, round your answers to the nearest dollar. Depreciation Year 1 Year 2arrow_forwardDepreciation by Two Methods; Sale of Fixed Asset New lithographic equipment, acquired at a cost of $656,250 on March 1 of Year 1 (beginning of the fiscal year), has an estimated useful life of five years and an estimated residual value of $56,400. The manager requested information regarding the effect of alternative methods on the amount of depreciation expense each year. On March 4 of Year 5, the equipment was sold for $96,100. Required: 1. Determine the annual depreciation expense for each of the estimated five years of use, the accumulated depreciation at the end of each year, and the book value of the equipment at the end of each year by the following methods: a. Straight-line method Year DepreciationExpense Accumulated Depreciation,End of Year Book Value,End of Year 1 $fill in the blank 6c5ae1f44078fe7_1 $fill in the blank 6c5ae1f44078fe7_2 $fill in the blank 6c5ae1f44078fe7_3 2 $fill in the blank 6c5ae1f44078fe7_4 $fill in the blank 6c5ae1f44078fe7_5 $fill in the…arrow_forwardIf a fixed asset, such as a computer, were purchased on January 1st for $2,101.00 with an estimated life of 4 years and a salvage or residual value of $107.00, what is the journal entry for monthly expense under straight-line depreciation? Select the correct answer. A. Depreciation Expense$41.54 Accumulated Depreciation$41.54 B. Accumulated Depreciation$41.54 Depreciation Expense$41.54 C. Accumulated Depreciation$498.50 Depreciation Expense$498.50 D. Depreciation Expense$498.50 Accumulated Depreciation$498.50arrow_forward
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