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FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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The book value of an asset that is listed as a 10-year MACRS property is $49,500 after the first year. If the asset’s estimated salvage (market) value is $5000 after its 15-year useful life, what was the asset’s original cost basis? (a) $50,000 (b) $52,105 (c) $55,000 (d) $61,875
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- Consider a 5-year MACRS asset, which was purchased at $140,000. The asset was disposed of at end of year 5 with a salvage value of $50,000. What is amount of gain(or loss) when asset is disposed of ? O $33,872 O $11,280 O $17,744 O $16,128arrow_forwardASAP please, direct thumps up :)arrow_forwardAn asset with a purchase price of $501,013 falls in the 3-year MACRS asset class. The asset will be sold at the end of a three year project for $180,745. What is the book value of the asset at the end of the project? Round your answer to the nearest dollar. Year Depreciable Allowance 1 33% 2 45 3 15 4 7arrow_forward
- d. The depreciation deduction for year 11 of an asset with a 20-year useful life is $3,600. If the salvage value of the asset was estimated to be zero and straight line depreciation was used to calculate the depreciation deduction for year 11, the initial cost of this asset is most closely equal to which of the following values? (a) $42,000 (b) $67,750 $72,500 (d) $80,000 e. Consider the following data extracted from an After Tax Cash Flow calculation. Before Tax Cash Flow = $22,500 Loan Principal Payment = $7,434 Loan Interest Payment = $892 MACRS Depreciation Deduction = $7,405 Taxes Due = $5,397 Which of the following is closest to the After Tax Cash Flow? (a) $1,372 $8,777 (c) $8,806 (d) $16,211arrow_forwardCalculate the depreciation expense for an asset with the following details: Initial Cost: $50,000 Salvage Value: $5,000 Useful Life: 5 yearsarrow_forwardPQ16.09 An asset with a first cost of $100,000 is depreciated over 5-year period. It is expected to have a $10,000 salvage value at the end of 5 years. Using the straight-line method, what is the book value at the end of year 2?arrow_forward
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