ABC Co. purchased equipment for $50,000 with a salvage value of $5,000 on 2/1/20 with a life of five years. Calculate depreciation for 2020 using the sum of the digit and double declining balance method
Q: The December 31, 2020 balance sheet of Swifty Company showed Equipment of $75,000 and Accumulated…
A: Revised annual depreciation = Depreciable cost / Remaining useful life
Q: ABC Company purchased equipment on January 1, 2018 for ₱9,000,000. The equipment had a useful life…
A: Working Note;
Q: HH Co. purchased equipment at the beginning of 2020 for $53,000 with an estimated residual value of…
A: Answer) Calculation of gain or loss on disposal of Equipment Gain or loss on disposal of Equipment =…
Q: total accumulated depreciation to be reported in the balance sheet on December 2021.
A: Deprecation is a non cash expense referred to as reduction in the value of the asset due to its…
Q: On January 1, 2021, PANCHITAS CAFÉ purchased equipment for $180,000. The equipment had an estimated…
A: SLM depreciation = (cost - salvage value)/life = (180000-40000)/10 = 14000 SLM rate = SLM…
Q: On September 30, 2018, Bricker Enterprises purchased a machine for OMR 11,000. The estimated service…
A: Depreciation is the decrease in value of an asset due to various reasons like wear and tear,…
Q: Muggsy Bogues Company purchased equipment for $212,000 on October 1, 2020. It is estimated that the…
A: Depreciation: Depreciation is a method of reducing the capitalized cost of long-lived operating…
Q: The December 31, 2020 balance sheet of Swifty Company showed Equipment of $75,000 and Accumulated…
A: Depreciable cost = Original cost - Accumulated depreciation - Salvage value
Q: Cutter Enterprises purchased equipment for $72,000 on January 1, 2018. The equipment is expected to…
A: Accounting: It is the process of collecting, recording, analyzing the cost, summarizing cost,…
Q: On September 20, 2020, Shamille Company purchased machinery for P7,600,000. Residual value was…
A: Depreciable cost=Cost-Salvage value=P 7,600,000-P 400,000=P 7,200,000 Sum of…
Q: On January 1, 2018, Shopee Company purchased an equipment with an estimated useful life of 8 years.…
A: Solution: Under sum of years digit method of depreciation, depreciation is expected to be higher in…
Q: A machine was purchased at a cost of $9,600,000 on June 30, 2020. The machine’s estimated salvage…
A: Depreciation means the loss in value of assets because of usage of assets , passage of time or…
Q: On 1 January 2018 a company purchased new equipment for $700,000. It is estimated that the equipment…
A: Depreciation is an accounting technique that allocates the cost of a physical asset over its useful…
Q: Scott Company purchased equipment for $350,000 on 2020. It is estimated that the equipment will have…
A: Depreciation expense is a non cash expense and it is charged each year for the amount of asset…
Q: A company purchased a truck for $35,000 on January 1, 2019. The truck is estimated to have a useful…
A: Depreciation: Depreciation means the reduction in the value of an asset over the life of the assets…
Q: On May 1, 2019 equipment worth $40,000 was purchased with cash. Assuming straight-line method of…
A: Depreciation refers to reduction in value of an asset over a period of time due to usage of asset in…
Q: Preyer Industries purchased a lathe for $65,000 on 1/1/15. It will have an estimated life of eight…
A: The double declining balance is an accelerated cost recovery system
Q: A company purchased a computer system on January 1, 2021 for S 1,600,00 and sold it one year later…
A: Formula: Straight line method Depreciation = ( Asset cost - Salvage value ) / Useful life years
Q: On April 20, 2020, Maskell Co. purchased an asset costing $66,000 with a useful life of nine years…
A: Introduction: Depreciation: Decreasing value of fixed assets over its useful life period called as…
Q: Bautista Organizers purchased an equipment costing P50,000 on July 1, 2018. The equipment has an…
A: Accumulated depreciation refers to the total deprecation charges till a particular point. This can…
Q: Using the double - declining balance method, depreciation for 2018, and the book value at December…
A:
Q: Beckman enterprises purchase a depreciable asset on Oct1, year1 at a cost of 132,000. the asset is…
A: The depreciation expense is incurred on fixed assets as reduction in the value of fixed assets with…
Q: A company purchased a truck for $35,000 on January 1, 2019. The truck is estimated to have a useful…
A: The straight-line method of depreciation is the simplest method of calculating depreciation.
Q: PIKACHU purchased an equipment for P540,000 on January 1. 2020. The equipment has an estimated…
A: Fixed assets means the asset which is used by company for many years to come for the purpose of…
Q: Sheridan Company purchased machinery on January 1, 2020, for $85,600. The machinery is estimated to…
A: Double declining rate = 1/useful life*2 Under double-declining rate, residual value is not…
Q: Jersey Company purchased a depreciable asset for $400,000. The estimated salvage value is $30,000,…
A: The depreciation expense is charged on fixed assets as the values of assets are to be expensed with…
Q: n September 30, 2021, Shamille Company purchased machinery for P7,600,000. Residual value was…
A: The depreciation expense is charged on fixed assets as reduction in the value of fixed assets with…
Q: Obaid Co. purchased equipment for $1,000,000 which was estimated to have a useful life of 15 years…
A: Annual Depreciation (straight line method) = (Cost of the assets - Residual value) / Expected life…
Q: On July 1, 2020, Flint Company purchased for $3,960,000 snow-making equipment having an estimated…
A: Depreciation is the amortization of fixed asset cost over its useful life. Under Sum of years digit…
Q: Faithful Company purchased an equipment on January 2, 2021 for P3,000,000. The equipment had an…
A: DDB rate = (2 / Useful life) = 40% Depreciation expense for 2021 = P3,000,000 x 40% = P1,200,000 =…
Q: On July 1, 2010, GRACE Company purchased P2,160,000 snow-making equipment having an estimated useful…
A: Solution: (a). Sum of the years Digits Method: 2010 2011 Equipment $2,160,000 $2,160,000…
Q: Cutter Enterprises purchased equipment for $72.000 on January 1, 2018. The equipment is expected to…
A: Accounting: It is the process of collecting, recording, analyzing the cost, summarizing cost,…
Q: On July 1, 2020, Concord Corporation purchased factory equipment for $283000. Salvage value was…
A: Solution: Under Double declining balance method of depreciation, depreciation is based on double the…
Q: is to use the 200% double declining balance method for the first two years of the asset’s life and…
A: Accumulated Depreciation: The contra assets account which is used for accumulating all those…
Q: Metlock Company purchased a new plant asset on April 1, 2020, at a cost of $741,000. It was…
A: An organization or a company has different methods which are available to calculate the depreciation…
Q: On April 1, 2020, an entity purchased machinery for P3,300,000. The machinery has an estimated…
A: Fixed assets that are used in a business will undergo certain wear and tear due to continuous…
Q: On July 1, 2018, Mundo Corporation purchased factory equipment for $50,000. Residual value was…
A: Answer) Calculation of depreciation expense for 2019 Depreciation for 2019 = Book value at the end…
Q: Lockard Company purchased machinery on January 1, 2020, for $80,000. The machinery is estimated to…
A: (a) Compute 2020 depreciation expense using the straight-line method. Depreciation expense for the…
Q: Cutter Enterprises purchased equipment for $72.000 on January 1, 2018. The equipment is expected to…
A: Accounting: It is the process of collecting, recording, analyzing the cost, summarizing cost,…
Q: The following information pertains to Nour Company: 1- Equipment was purchased on September 1, 2014…
A: 1. Prepare the necessary adjusting entries at December 31, 2019: S. No. Account Title Debit…
Q: On September 19, 2020, Sunland Company purchased machinery for $478000. Salvage value was estimated…
A: Solution: Under sum of years' digits method of depreciation. Depreciation is based on sum of digits…
Q: Bonita Company purchased a new plant asset on April 1, 2020, at a cost of $738,000. It was estimated…
A: Double declining depreciation rate = Straight line depreciation rate x 2 = (100/20 years) x 2 = 10%…
Q: sing the double-declining balance method. Show your calculations Blank 1. Fill in the blank,…
A: Depreciation is a wear and tear of an asset. There are various methods of depreciation. (1) units of…
Q: Metlock Company purchased machinery on January 1, 2020, for $ 88,000. The machinery is estimated to…
A: Formula: Straight line method Depreciation = ( Cost of Asset - salvage value ) / useful life
Q: On 1/1/18, Cumberland Corp. purchased a machine for $60,000. The machine cost Cumberland $2,800 for…
A: Depreciation is the allocation of cost of asset over the useful life of the asset. It can be charged…
Q: On October 1, 2015, PCU Company purchased machinery for P1,900,000. Salvage value was estimated to…
A: Given information, Cost of machinery =P1,900,000 Salvage value =P100,000 Useful life = 8 years Sum…
Q: PIKACHU purchased an equipment for P540,000 on January 1, 2020. The equipment has an estimated…
A: Sum of year digit method is a depreciation method where the depreciation for the year is calculated…
Q: Peter M. Dell Co. purchased equipment for $510,000 which was estimated to have a useful life of 10…
A: a. No entry is required to correct the prior Years' depreciation
Q: A Company purchased equipment on January 1, 2019 for AED 70,000. It is estimated that the equipment…
A: Depreciation is an expense for consuming the fixed assets of the entity. The depreciation method…
Q: the depreciation expense for 2021 will be
A: Double declining balance method is one of the accelerated methods used for the calculation of the…
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- Akron Incorporated purchased an asset at the beginning of Year 1 for 375,000. The estimated residual value is 15,000. Akron estimates that the asset has a service life of 5 years. Calculate the depreciation expense using the sum-of-the-years-digits method for Years 1 and 2 of the assets life.Albany Corporation purchased equipment at the beginning of Year 1 for 75,000. The asset does not have a residual value and is estimated to be in service for 8 years. Calculate the depreciation expense for Years 1 and 2 using the double-declining-balance method. Round to the nearest dollar.Chapman Inc. purchased a piece of equipment in 2018. Chapman depreciated the equipment on a straight-line basis over a useful life of 10 years and used a residual value of $12,000. Chapmans depreciation expense for 2019 was $11,000. What was the original cost of the building? a. $98,000 b. $110,000 c. $122,000 d. $134,000
- On May 10, 2019, Horan Company purchased equipment for 25,000. The equipment has an estimated service life of 5 years and zero residual value. Assume that the straight-line depreciation method is used. Required: Compute the depreciation expense for 2019 for each of the following four alternatives: 1. Horan computes depreciation expense to the nearest day. (Use 12 months of 30 days each and round the daily depreciation rate to 2 decimal places.) 2. Horan computes depreciation expense to the nearest month. Assets purchased in the first half of the month are considered owned for the whole month. 3. Horan computes depreciation expense to the nearest whole year. Assets purchased in the first half of the year are considered owned for the whole year. 4. Horan records one-half years depreciation expense on all assets purchased during the year.On January 1, 2014, Klinefelter Company purchased a building for 520,000. The building had an estimated life of 20 years and an estimated residual value of 20,000. The company has been depreciating the building using straight-line depreciation. At the beginning of 2020, the following independent situations occur: a. The company estimates that the building has a remaining life of 10 years (for a total of 16 years). b. The company changes to the sum-of-the-years-digits method. c. The company discovers that it had ignored the estimated residual value in the computation of the annual depreciation each year. Required: For each of the independent situations, prepare all journal entries related to the building for 2020. Ignore income taxes.Hunter Company purchased a light truck on January 2, 2019 for 18,000. The truck, which will be used for deliveries, has the following characteristics: Estimated life: 5 years Estimated residual value: 3,000 Depreciation method for financial statements: straight-line method Depreciation for income tax purposes: MACRS (3-year life) From 2019 through 2023, each year, Hunter had sales of 100,000, cost of goods sold of 60,000, and operating expenses (excluding depreciation) of 15,000. The truck was disposed of on December 31, 2023, for 2,000. Required: 1. Prepare an income statement for financial reporting through pretax accounting income for each of the 5 years, 2019 through 2023. 2. Prepare, instead, an income statement for income tax purposes through taxable income for each of the 5 years, 2019 through 2023. 3. Compare the total income for all 5 years under Requirements 1 and 2.
- Susquehanna Company purchased an asset at the beginning of the current year for 250,000. The estimated residual value is 25,000. Susquehanna estimates that the asset will be used for 10 years and uses straight-line depreciation. Calculate the depreciation expense per year.Kam Company purchased a machine on January 2, 2019, for 20,000. The machine had an expected life of 8 years and a residual value of 300. The double-declining-balance method of depreciation is used. Required: 1. Compute the depreciation expense for each year of the assets life and book value at the end of each year. 2. Assuming that the company has a policy of always changing to the straight-line method at the midpoint of the assets life, compute the depreciation expense for each year of the assets life. 3. Assuming that the company always changes to the straight-line method at the beginning of the year when the annual straight-line amount exceeds the double-declining-balance amount, compute the depreciation expense for each year of the assets life.Montello Inc. purchases a delivery truck for $15,000. The truck has a salvage value of $3,000 and is expected to be driven for eight years. Montello uses the straight-line depreciation method. Calculate the annual depreciation expense.
- Montello Inc. purchases a delivery truck for $25,000. The truck has a salvage value of $6,000 and is expected to be driven for ten years. Montello uses the straight-line depreciation method. Calculate the annual depreciation expense.Hathaway Company purchased a copying machine for 8,700 on October 1, 2019. The machines residual value was 500 and its expected service life was 5 years. Hathaway computes depreciation expense to the nearest whole month. Required: 1. Compute depredation expense (rounded to the nearest dollar) for 2019 and 2020 using the: a. straight-line method b. sum-of-the-years-digits method c. double-declining-balance method 2. Next Level Which method produces the highest book value at the end of 2020? 3. Next Level Which method produces the highest charge to income in 2020? 4. Next Level Over the life of the asset, which method produces the greatest amount of depreciation expense?When depreciation is recorded each period, what account is debited? a. Depreciation Expense b. Cash c. Accumulated Depreciation d. The fixed asset account involved Use the following information for Multiple-Choice Questions 7-4 through 7-6: Cox Inc. acquired a machine for on January 1, 2019. The machine has a salvage value of $20,000 and a 5-year useful life. Cox expects the machine to run for 15,000 machine hours. The machine was actually used for 4,200 hours in 2019 and 3,450 hours in 2020.
