* Your answer is incorrect. Compute the depreciation for this asset for 2022 and 2023 using the double-declining-balance method. (Round answers to 0 decimal places, e.g. 45,892.) Depreciation for 2022 € Depreciation for 2023 € 95400 85860
* Your answer is incorrect. Compute the depreciation for this asset for 2022 and 2023 using the double-declining-balance method. (Round answers to 0 decimal places, e.g. 45,892.) Depreciation for 2022 € Depreciation for 2023 € 95400 85860
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Concept explainers
Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
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Transcribed Image Text:Kingbird AG purchased a new plant asset on April 1, 2022, at a cost of €954,000. It was estimated to have a service life of 20 years and
a residual value of €78,720. Kingbird' accounting period is the calendar year.
(a)
Your Answer Correct Answer
Your answer is correct.
Compute the depreciation for this asset for 2022 and 2023 using the sum-of-the-years-digits method. (Round answers to O decimal
places, e.g. 45,892.)
Depreciation for 2022
Depreciation for 2023 €
(b)
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Solution
* Your answer is incorrect.
Compute the depreciation for this asset for 2022 and 2023 using the double-declining-balance method. (Round answers to O
decimal places, e.g. 45,892.)
Depreciation for 2022 €
Depreciation for 2023 €
95400
Attempts: 2 of 2 used
85860
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