On April 1, 2018, Magnum Company purchased a delivery equipment for $88,000, with an expected useful life of 4 years and an estimated salvage value of $8,000. On January 1, 2021, the company decided to exchange its old delivery equipment for a similar new one. At the time of exchange, the old delivery equipment has a fair market value of $32,000 and $60,000 cash was paid. The company uses the straight line method of depreciation. The cost of the new equipment is: * O $88,000 O $148,000 $92,000 O $32,000 None of the above

On April 1, 2018, Magnum Company purchased a delivery equipment for $88,000, with an expected useful life of 4 years and an estimated salvage value of $8,000. On January 1, 2021, the company decided to exchange its old delivery equipment for a similar new one. At the time of exchange, the old delivery equipment has a fair market value of $32,000 and $60,000 cash was paid. The company uses the straight line method of depreciation. The cost of the new equipment is: * O $88,000 O $148,000 $92,000 O $32,000 None of the above

Name: FAlpQLSd8PvgC4zihRrNM14FZm52PFOYZMrormkesponseOn April 1, 2018, Magnu
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Description: FAlpQLSd8PvgC4zihRrNM14FZm52PFOYZMrormkesponseOn April 1, 2018, Magnum Company purchased a delivery equipment for $88,000,with an expected useful life of 4 years and an estimated salvage value of $8,000.On January 1, 2021, the company decided to exc

Financial Accounting: The Impact on Decision Makers

10th Edition

ISBN:9781305654174

Author:Gary A. Porter, Curtis L. Norton

Publisher:Gary A. Porter, Curtis L. Norton

Chapter8: Operating Assets: Property, Plant, And Equipment, And Intangibles

Section: Chapter Questions

Problem 8.5E: Change in Estimate Assume that Bloomer Company purchased a new machine on January 1, 2016, for...

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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
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P11.2 (LO 1,2) (Deprec. for partial periods - SL, Act., SYD, and Declining-Balance) The cost of equip. purchased by Charleston, Inc., on June 1, 2020, is $89,000. It is estimated that the machine will have a $5,000 salvage value at the end of it's service life. It's service life is estimated at 7 years, it's total working hours are estimated at 42,000, and it's total production is estimated at 525,000 units. During 2020, the machine was operated 6,000 hours and produced 55,000 units. During 2021, the machine was operated 5,500 hours and produced 48,000 units. Instructions: Compute deprec. expense on the machine for the year ending Dec. 31, 2020, and the year ending Dec. 31, 2021, using the following methods. A. Sum-of-the-years'-digits. B. Declining-balance (twice the straight-line rate).
The following are available from Pinkish Gambino: Machinery Equipment Cost of Acquisition P560,000 P140,000 Estimated Salvage Value 60,000 20,000 Date of Acquisition January 1, 2020 July 1, 2020 Estimated Life 10 years 5 years On October 1, 2023, the above machinery was sold for P400,000 while the equipment could no longer be used on March 31, 2023 and the company received P50,000 from the insurers in full settlement of the claim. How much is the net gain or net loss from the disposal of the assets above? Group of answer choices A. 24,000 B. 27,500 C. 3,500 D. 23,500