HORNGREN'S FINANCIAL & MANGERIAL ACCOUNT
7th Edition
ISBN: 9780136505273
Author: MILLER-NOBLES
Publisher: PEARSON
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Textbook Question
Chapter 9, Problem 10AQC
A truck costs $50,000 when new and has
a. No gain or loss
b. Gain of $5,000
c. Loss of $5,000
d. Gain of $45,000
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Students have asked these similar questions
XMohan & Co. is considering the purchase of machine.
Two machines X and Y each Costing Rs.50, 000 are
available. Earnings after taxes before depreciation are
expected to be as under:
Year
1
2
3
4
5
Machine 'X'
15000
20000
25000
15000
10000
(Rs.)
Machine 'Y' (Rs.)
5000
15000
20000
30000
20000
Estimate the two alternatives according to:
(a) Payback method, and
(b) NPV method a discount rate of 10% is to be used.
Assume that Abdul Baari LLC acquiring a new truck for OMR 45000. In exchange, the company pays OMR 32000 cash and old truck. The old truck originally cost OMR 40000 and has accumulated depreciation of OMR 25,000, which implies a OMR 15,000 book value at the time of exchange. From the following given options identify the correct journal entry for profit or loss on exchange of old truck with new truck.
a.
Dr New Truck A/C OMR 45000 Dr Loss on exchange of old Truck OMR 2000 and cash A/c 32000 Cr old Truck A/c OMR 15000
b.
None of the given options
c.
Dr New Truck A/C OMR 47000 and Cr Cash A/c 32000 Cr Old truck A/c 15000
d.
Dr New Truck A/c OMR 45000 Dr Loss on exchange of truck OMR 2000 Dr Accumulated depreciation on old Truck OMR 25000 and Cr cash A/c 32000 Cr Old Truck A/C OMR 40000
Clear my choice
What amount should be capitalized as the cost of the new equipment?
The Whale Corporation acquired some new equipment. The following data have been made
available to you:
List price of the equipment
Freight paid on the new equipment
Cash discount available but not taken
Cost of removing the old equipment
Installation costs of the new equipment
P140,000
4,500
2,000
1,700
4,300
Testing costs before the equipment was put to regular operations
(including P1,200 in wages of the regular operator)
Loss on premature retirement of the old equipment
Estimated cost of manufacturing similar equipment in the company's
own plant, including overhead
Oa. P288,650
O b. P150,650
O c. P149,750
O d. P147,750
O Other:
2,950
1,200
138,000
Chapter 9 Solutions
HORNGREN'S FINANCIAL & MANGERIAL ACCOUNT
Ch. 9 - Prob. 1QCCh. 9 - Prob. 2QCCh. 9 - Which method almost always produces the most...Ch. 9 - A Celty Airline jet costs 28,000,000 and is...Ch. 9 - A copy machine costs 45,000 when new and has...Ch. 9 - Suppose Print and Photo Center in the preceding...Ch. 9 - Prob. 7QCCh. 9 - Prob. 8QCCh. 9 - Liberty Corporation reported beginning and ending...Ch. 9 - A truck costs 50,000 when new and has accumulated...
Ch. 9 - Prob. 2RQCh. 9 - Prob. 3RQCh. 9 - Prob. 4RQCh. 9 - Prob. 5RQCh. 9 - What is the difference between a capital...Ch. 9 - Prob. 7RQCh. 9 - Prob. 8RQCh. 9 - How does a business decide which depreciation...Ch. 9 - Prob. 11RQCh. 9 - Prob. 12RQCh. 9 - Prob. 13RQCh. 9 - How is gain o r loss determined when disposing of...Ch. 9 - Prob. 15RQCh. 9 - Prob. 16RQCh. 9 - Prob. 17RQCh. 9 - Prob. 18RQCh. 9 - Prob. 19RQCh. 9 - What does it mean if an exchange of plant assets...Ch. 9 - Prob. 9.19E
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