E9-16 (Algo) Computing Depreciation and Book Value for Two Years Using Alternative Depreciation Methods and Interpreting the Impact on the Fixed Asset Turnover Ratio [LO 9-3, LO 9-7] Korin Industries bought a machine for $95,000 cash. The estimated useful life was five years and the estimated residual value was $5,000. Assume that the estimated useful life in productive units is 198,000. Units actually produced were 52,800 in year 1 and 59,400 in year 2. Required: 1. Determine the appropriate amounts to complete the following schedule. 2-a. Which method would result in the lowest net income for year 1? 2-b. Which method would result in the lowest net income for year 2? 3. Which method would result in the lowest fixed asset turnover ratio for year 1? Complete this question by entering your answers in the tabs below. Req 1 Req 2A Req 2B Req 3 Determine the appropriate amounts to complete the following schedule. (Do not round intermediate calculations. Round final answers to the nearest whole dollar.) Method of Depreciation Straight-line Units-of-production Double-declining-balance Depreciation Expense Year 1 Year 2 Year 1 Book Value at the End of Year 2
E9-16 (Algo) Computing Depreciation and Book Value for Two Years Using Alternative Depreciation Methods and Interpreting the Impact on the Fixed Asset Turnover Ratio [LO 9-3, LO 9-7] Korin Industries bought a machine for $95,000 cash. The estimated useful life was five years and the estimated residual value was $5,000. Assume that the estimated useful life in productive units is 198,000. Units actually produced were 52,800 in year 1 and 59,400 in year 2. Required: 1. Determine the appropriate amounts to complete the following schedule. 2-a. Which method would result in the lowest net income for year 1? 2-b. Which method would result in the lowest net income for year 2? 3. Which method would result in the lowest fixed asset turnover ratio for year 1? Complete this question by entering your answers in the tabs below. Req 1 Req 2A Req 2B Req 3 Determine the appropriate amounts to complete the following schedule. (Do not round intermediate calculations. Round final answers to the nearest whole dollar.) Method of Depreciation Straight-line Units-of-production Double-declining-balance Depreciation Expense Year 1 Year 2 Year 1 Book Value at the End of Year 2
Chapter11: Long-term Assets
Section: Chapter Questions
Problem 15PB: Urquhart Global purchases a building to house its administrative offices for $500,000. The best...
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VIEWStep 4: 3. Determine the method that would result in the lowest fixed asset turnover ratio for year 1:
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