machine coating $250,000 with a five your life and animated $25,000 salvege valum is installed in Oun Compenys factory on Jerury 1. The toory marege stimates the machine will produce 400,000 units of product during ita ife. It actually produces the following units year 1-100,000, y 2-120,000 and year 3-20,000 units ppare depreciation schedules computing depreciation for the first 3 years under the straight-line method and urits of production methed.
Q: machine costing $250,000 with a five-year life and an estimated $25,000 salvege value is installed…
A: Depreciation can be defined as the actual decrease in the fair value of any asset due to wear and…
Q: A machine costing $210,000 with a four-year life and an estimated $16,000 salvage value Is Installed…
A: Depreciation under straight-line method = ( Historical cost- Salvage value)/Useful life Depreciation…
Q: Required information Use the following information for the Exercises below. [The following…
A: 1. Depreciation Expenses - Depreciation Expenses are the expense incurred on the wear and tear of…
Q: Nicole's Getaway Spa (NGS) purchased a hydrotherapy tub system to add to the wellness programs at…
A: Depreciation is the method of accounting which is used for allocating the cost of the physical or…
Q: Nicole’s Getaway Spa (NGS) purchased a hydrotherapy tub system to add to the wellness programsat…
A: Depreciation is the process of devaluation of an asset as a result of considering the wear and tear…
Q: A machine costing $209,600 with a four-year life and an estimated $16,000 salvage value is installed…
A: Depreciation is charged on value of assets for the normal wear and tear expense and for the repair…
Q: Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the…
A: GIVEN Ramirez Company installs a computerized manufacturing machine in its factory at the…
Q: A 600-ton press used to produce compositematerial fuel cell components for automobiles using proton…
A: a.
Q: Cheetah Copy purchased a new copy machine. The new machine cost $116,000 including installation. The…
A: The depreciation epxense is charged on fixed assets as reduction in its value with the usage and…
Q: A tax and duty-free importation of a 30-horsepower sand mill for paint manufacturing costs P360,000,…
A: Facts of the question: Import cost of sand mill = P360,000 Bank, brokerage charges = P5,000…
Q: A tax and duty free importation of a 30 horse power sand mill for paint manufacturing cost 400,000…
A: Total cost of the mill = Manufacturing cost + Bank charges arrester and brokerage cost + Foundation…
Q: Cheetah Copy purchased a new copy machine. The new machine cost $140,000 including installation. The…
A: Annual Depreciation as per straight line = (Cost of machine - Residual value) / Life in years
Q: University Car Wash built a deluxe car wash across the street from campus. The new machines cost…
A: Depreciation expense is the non-cash outlay which is reported in the books to record the regular…
Q: mased a crane that cost $ 500,000. The crane estimated resi s $50,000. The estimated total hours of…
A: "Since you have asked multiple questions, we will solve first question for you. If you want any…
Q: A machine costing $209;600 with a four-year life and an estimated $16,000 salvage value is installed…
A: Straight line depreciation = ( Initial Cost - Salvage Value ) / Estimated useful life…
Q: University Car Wash built a deluxe car wash across the street from campus. The new machines cost…
A: Step 1: Answer Sheet: Formula Sheet:
Q: AEC purchased an equipment for its manufacturing plant that costs PhP 3 750 000. It is estimated to…
A: In the context of the given question, we are going to compute the book value of the plant after…
Q: Extra Corporation is installing a new machine at its production facility. It has incurred these…
A: Cost of property , plant and equipment includes purchase price ( less trade discount ) , taxes ( if…
Q: Required Information Use the following information for the Exercises below. [The following…
A: Lets understand the basics. Depreciation is reduction in value of asset due to wear and tear,…
Q: A machine costing $207,400 with a four-year life and an estimated $17,000 salvage value is installed…
A: Depreciation can be referred to as the fall in the value of a fixed asset due to the usage, wear and…
Q: The Befort Company field for a patent on a new type of machine. The application costs totaled…
A: Since nothing is mentioned, it is assumed that the question is asking for the calculation of the…
Q: Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the…
A: Annual Depreciation (Units of production method) =[( cost of Asset - salvage value ) x Annual…
Q: Thunderbird Manufacturing purchases a new stamping machine for $50,000. Its useful life is estimated…
A: Formula: Units-of-Production = ( Asset cost - Salvage value ) / Estimated production
Q: A machine costing $209,000 with a four-year life and an estimated $17,000 salvage value is installed…
A: Given that, cost of the asset = $209000 salvage value of asset = $17000 use ful life of asset = 4…
Q: A machine costing $209,400 with a four-year life and an estimated $19,000 salvage value is installed…
A: Introduction: Depreciation: Decreasing value of fixed assets over its useful life period called as…
Q: Abbott placed into service a flexible manufacturing cell costing $850,000 early this year for…
A: a) Computation of taxable income for the first year:Sales-(Deductible…
Q: Requlred Informatlon Use the following information for the Exercises below. [The following…
A: Under unit of production method of depreciation, depreciation allows on the basis of production each…
Q: University Car Wash built a deluxe car wash across the street from campus. The new machines cost…
A: Depreciation is the allocation of cost of asset over the useful life of the asset.
Q: A machine costing $209,400 with a four-year life and an estimated $19,000 salvage value is installed…
A: Depreciation is the reduction in value in fixed asset over a period of time. This reduction is…
Q: A tax and duty free importation of a 30-horsepower sand mill for paint manufacturing costs…
A: Depreciation is the reduction in the value of the asset over a useful life of the assets.
Q: Solve the following problems. Show clean and complete details of your work for each number. Problem…
A: Hi There, as per the policy of Bartleby we are bound to give the answer of first question only,…
Q: A machine costing $210,000 with a four-year life and an estimated $16,000 salvage value Is Installed…
A: The question is related to Depreciation Accounting. In Straight-line Method of Depreciation the…
Q: Adams Moran manages the cutting department of Greene Baird Company. He purchased a tree-cutting…
A: A replacement decision for the old machine should be taken on the basis of the total costs of the…
Q: A machine costing $217,200 with a four-year life and an estimated $20,000 salvage value is installed…
A: Double declining balance method is a method of charging depreciation, under which depreciation is…
Q: Required information Use the following information for the Exercises below. [The following…
A: Depreciation: Depreciation is the decrease in the value of assets due to normal tear & wear, the…
Q: Required Information Use the following information for the Exercises below. [The following…
A: Solution:- Straight line method is one of the depreciation method. It is simplest method compared to…
Q: Required information Use the following information for the Exercises below. [The following…
A: Depreciation is the loss in the value of the asset caused due to its usage, wear, and tear. There…
Q: University Car Wash built a deluxe car wash across the street from campus. The new machines cost…
A: Depreciation means decline in the estimation of benefit inside its valuable life because of mileage…
Q: A tax- and duty-free importation of a 30-horsepower sand mill for paint manufacturing costs ₱400,000…
A: Depreciation:- It is the expense for the company which occurs normal wear and tear of the assets.…
Q: Ramire mpany inStalis a Cor manufacturing madchine in its tory at the beginning of the year at a ost…
A: Solution: DDB rate = (1/10)*2 = 20%
Q: Dorman company purchased a new machine for its production process. The following costs were incurred…
A: All expenses incurred to bring an asset to a condition where it can be used is capitalized as part…
Q: A machine costing $210,400 with a four-year life and an estimated $18,000 salvage value is installed…
A: Solution Given Cost 210400 Salvage value 18000 Useful life in years 4 year…
Q: 0 hp sandmill for paint manufacturing cost P 360,000. Bank charges arrastre and brokerage cost P…
A: Straight-line depreciation The simplest straightforward approach for determining an asset's loss of…
Q: Required information Use the following information for the Exercises below. [The following…
A: Under units of production method, depreciation expense per unit is calculated by dividing…
Q: University Car Wash built a deluxe car wash across the street from campus. The new machines cost…
A: Under the straight line method of depreciation, the depreciation is charged at the same rate for the…
machine coating $250,000 with a five your life and animated $25,000 salvege valum is installed in Oun Compenys factory on Jerury 1. The toory marege stimates the machine will produce 400,000 units of product during ita ife. It actually produces the following units year 1-100,000, y 2-120,000 and year 3-20,000 units
ppare
Step by step
Solved in 2 steps
- 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 125,000 miles. Montello uses the units-of-production depreciation method, and in year one the company expects the truck to be driven for 26,000 miles; in year two, 30,000 miles; and in year three, 40,000 miles. Consider how the purchase of the truck will impact Montellos depreciation expense each year and what the trucks book value will be each year after depreciation expense is recorded.St. Johns Medical Center (SJMC) has five medical technicians who are responsible for conducting cardiac catheterization testing in SJMCs Cath Lab. Each technician is paid a salary of 36,000 and is capable of conducting 1,000 procedures per year. The cardiac catheterization equipment is one year old and was purchased for 250,000. It is expected to last five years. The equipments capacity is 25,000 procedures over its life. Depreciation is computed on a straight-line basis, with no salvage value expected. The reading of the catheterization results is conducted by an outside physician whose fee is 120 per test. The technicians report with the outside physicians note of results is sent to the referring physician. In addition to the salaries and equipment, SJMC spends 50,000 for supplies and other costs needed to operate the equipment (assuming 5,000 procedures are conducted). When SJMC purchased the equipment, it fully expected to perform 5,000 procedures per year. In fact, during its first year of operation, 5,000 procedures were run. However, a larger hospital has established a clinic in the city and will siphon off some of SJMCs business. During the coming years, SJMC expects to run only 4,200 cath procedures yearly. SJMC has been charging 850 for the procedureenough to cover the direct costs of the procedure plus an assignment of general overhead (e.g., depreciation on the hospital building, lighting and heating, and janitorial services). At the beginning of the second year, an HMO from a neighboring community approached SJMC and offered to send its clients to SJMC for cardiac catheterization provided that the charge per procedure would be 550. The HMO estimates that it can provide about 500 patients per year. The HMO has indicated that the arrangement is temporaryfor one year only. The HMO expects to have its own testing capabilities within one year. Required: 1. Classify the resources associated with the cardiac catheterization activity into one of the following: (1) committed resources, or (2) flexible resources. 2. Calculate the activity rate for the cardiac catheterization activity. Break the activity rate into fixed and variable components. Now, classify each activity resource as relevant or irrelevant with respect to the following alternatives: (1) accept the HMO offer, or (2) reject the HMO offer. Explain your reasoning. 3. Assume that SJMC will accept the HMO offer if it reduces the hospitals operating costs. Should the HMO offer be accepted? 4. Jerold Bosserman, SJMCs hospital controller, argued against accepting the HMOs offer. Instead, he argued that the hospital should be increasing the charge per procedure rather than accepting business that doesnt even cover full costs. He also was concerned about local physician reaction if word got out that the HMO was receiving procedures for 550. Discuss the merits of Jerolds position. Include in your discussion an assessment of the price increase that would be needed if the objective is to maintain total revenues from cardiac catheterizations experienced in the first year of operation. 5. Chandra Denton, SJMCs administrator, has been informed that one of the Cath Lab technicians is leaving for an opportunity at a larger hospital. She met with the other technicians, and they agreed to increase their hours to pick up the slack so that SJMC wont need to hire another technician. By working a couple hours extra every week, each remaining technician can perform 1,050 procedures per year. They agreed to do this for an increase in salary of 2,000 per year. How does this outcome affect the analysis of the HMO offer? 6. Assuming that SJMC wants to bring in the same revenues earned in the cardiac catheterization activitys first year less the reduction in resource spending attributable to using only four technicians, how much must SJMC charge for a procedure?Acquisition Cost Desert State University installed a HD video board with an invoice price of $5,000,000 in its football stadium. Desert State paid an additional $100,000 of delivery and installation costs relating to this board. Because this is one of the largest boards in the world, Desert State also installed ten 5-ton air conditioning units at a total cost of $120,000 to keep the board cool in the desert heat. Required: Determine the cost of the video board.
- Underwoods Miners recently purchased the rights to a diamond mine. It is estimated that there are two million tons of ore within the mine. Underwoods paid $46,000,000 for the rights and expects to harvest the ore over the next fifteen years. The following is the expected extraction for the next five years. Year 1: 50,000 tons Year 2: 900,000 tons Year 3: 400,000 tons Year 4: 210,000 tons Year 5: 150,000 tons Calculate the depletion expense for the next five years and create the journal entry for year one.Ronson recently purchased a new boat to help ship product overseas. The following information is related to that purchase: purchase price $4,500,000 cost to bring boat to production facility $15,000 yearly insurance cost $12,000 pays annual maintenance cost of $22,000 received a 10% discount on sales price Determine the acquisition cost of the boat and record the journal entry needed.Dunedin Drilling Company recently acquired a new machine at a cost of 350,000. The machine has an estimated useful life of four years or 100,000 hours, and a salvage value of 30,000. This machine will be used 30,000 hours during Year 1, 20,000 hours in Year 2, 40,000 hours in Year 3, and 10,000 hours in Year 4. Dunedin buys equipment frequently and wants to print a depreciation schedule for each assets life. Review the worksheet called DEPREC that follows these requirements. Since some assets acquired are depreciated by straight-line, others by units of production, and others by double-declining balance, DEPREC shows all three methods. You are to use this worksheet to prepare depreciation schedules for the new machine.
- Dunedin Drilling Company recently acquired a new machine at a cost of 350,000. The machine has an estimated useful life of four years or 100,000 hours, and a salvage value of 30,000. This machine will be used 30,000 hours during Year 1, 20,000 hours in Year 2, 40,000 hours in Year 3, and 10,000 hours in Year 4. With DEPREC5 still on the screen, click the Chart sheet tab. This chart shows the accumulated depreciation under all three depreciation methods. Identify below the depreciation method that each represents. Series 1 _____________________ Series 2 _____________________ Series 3 _____________________ When the assignment is complete, close the file without saving it again. Worksheet. The problem thus far has assumed that assets are depreciated a full year in the year acquired. Normally, depreciation begins in the month acquired. For example, an asset acquired at the beginning of April is depreciated for only nine months in the year of acquisition. Modify the DEPREC2 worksheet to include the month of acquisition as an additional item of input. To demonstrate proper handling of this factor on the depreciation schedule, modify the formulas for the first two years. Some of the formulas may not actually need to be revised. Do not modify the formulas for Years 3 through 8 and ignore the numbers shown in those years. Some will be incorrect as will be some of the totals. Preview the printout to make sure that the worksheet will print neatly on one page, and then print the worksheet. Save the completed file as DEPRECT. Hint: Insert the month in row 6 of the Data Section specifying the month by a number (e.g., April is the fourth month of the year). Redo the formulas for Years 1 and 2. For the units of production method, assume no change in the estimated hours for both years. Chart. Using the DEPREC5 file, prepare a line chart or XY chart that plots annual depreciation expense under all three depreciation methods. No Chart Data Table is needed; use the range B29 to E36 on the worksheet as a basis for preparing the chart if you prepare an XY chart. Use C29 to E36 if you prepare a line chart. Enter your name somewhere on the chart. Save the file again as DEPREC5. Print the chart.Utica Machinery Company purchases an asset for 1,200,000. After the machine has been used for 25,000 hours, the company expects to sell the asset for 150,000. What is the depreciation rate per hour based on activity?Gimli Miners recently purchased the rights to a diamond mine. It is estimated that there are one million tons of ore within the mine. Gimli paid $23,100,000 for the rights and expects to harvest the ore over the next ten years. The following is the expected extraction for the next five years. Year 1: 50,000 tons Year 2: 90,000 tons Year 3: 100,000 tons Year 4: 110,000 tons Year 5: 130,000 tons Calculate the depletion expense for the next five years, and create the journal entry for year one.
- Colquhoun International purchases a warehouse for $300,000. The best estimate of the salvage value at the time of purchase was $15,000, and it is expected to be used for twenty-five years. Colquhoun uses the straight-line depreciation method for all warehouse buildings. After four years of recording depreciation, Colquhoun determines that the warehouse will be useful for only another fifteen years. Calculate annual depreciation expense for the first four years. Determine the depreciation expense for the final fifteen years of the assets life, and create the journal entry for year five.The activity of moving materials uses four forklifts, each leased for 18,000 per year. A forklift is capable of making 5,000 moves per year, where a move is defined as a round trip from the plant to the warehouse and back. During the year, a total of 18,000 moves were made. What is the cost of the unused capacity for the moving goods activity? a. 5,400 b. 1,800 c. 7,200 d. 3,600IMPACT OF IMPROVEMENTS AND REPLACEMENTS ON THE CALCULATION OF DEPRECIATION On January 1, 20-1, two flight simulators were purchased by a space camp for 77,000 each with a salvage value of 5,000 each and estimated useful lives of eight years. On January 1, 20-2, the hydraulic system for Simulator A was replaced for 6,000 cash and an updated computer for more advanced students was installed in Simulator B for 9,000 cash. The hydraulic system is expected to extend the life of Simulator A three years beyond the original estimate. REQUIRED 1. Using the straight-line method, prepare general journal entries for depreciation on December 31, 20-1, for Simulators A and B. 2. Enter the transactions for January 20-2 in a general journal. 3. Assuming no other additions, improvements, or replacements, calculate the depreciation expense for each simulator for 20-2 through 20-8.