On January 1, 2016, Indians Corporation bought a factory equipment for P924,000 salvage value was estimated at P24,000. The asset will be depreciated over 10 years using the double declining balance method. How much is the total accumulated depreciation to be reported in the balance sheet on December 31, 2021?
Q: On January 1, 2021, Marigold company acquired a computer amounting to P47,000, transportation cost…
A: Cost of computer = Purchase price of computer + transportation cost + installation cost of desk…
Q: What is the accumulated depreciation as of December 31, 2017?
A: The Double declining balance is one of the two accelerated depreciation methods, and it uses a…
Q: On October 1, 2017, ABC Company purchased a delivery equipment for P1,000,000. It had an estimated…
A: Solution : Given Purchase date October 1 2017 Purchase cost 1,000,000 Estimated…
Q: Haemul Pajeon Company purchased a machine on January 2, 2018 for P500,000. The machine has an…
A: 1. Asset Value =P500,000 Estimated useful life = 8 years Depreciation Amount for 2018 = (Asset…
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: A company purchased factory equipment on April 1, 2018 for $60,000. t estimated that the equipment…
A: Ans. Calculation of depreciation as per SLM: Depreciation = Cost - Residual value/useful life
Q: On January 1, 2017, Jungkook Company purchased an equipment for P1,970,000. On this date, the…
A: Depreciation means the loss in value of assets because of usage of assets , passage of time or…
Q: On September 1, 2017, Tan Party Supplies purchased catering equipment for $4,680. The equipment is…
A: Depreciation means the amount fixed assets written off due to normal wear and tear , normal usage ,…
Q: Company bought a new equipment for P800,000. The equipment has an estimated salvage value of…
A: Solution Depreciation is the reduction of the recorded cost of a fixed asset in a systematic manner…
Q: On January 1,2013, Edition Company purchased an equipment for P1,970,000. On this date, the…
A: Depreciation is an expense which usually charged on the fixed or non-current assets over the years…
Q: CEE Corporation purchased a machine on January 1, 2016 by instalment, initially paying $1,000,000,…
A: Depreciation - It refers to the fall in the value of fixed assets due to wear and tear. It is a…
Q: On October 1, 2017, Holt Company places a new asset into service. The cost of the asset is $120,000…
A: I'm answering the 4th part as required by the student. 4. Depreciation represents the reduction from…
Q: Bataan Company purchased a machinery that was installed and ready for use on January 1, 2019 at a…
A: Depreciation rate under double declining rate = = 2 / useful life x 100% Given…
Q: On January 1, 2014, McMahan Company purchased equipment at a cost of $420,000. The equipment was…
A: Solution: Depreciable cost of equipment = Cost - Salvage value = $420,000 - $60,000 = $360,000…
Q: On January 1, 2010, Graham Company purchased a new machine for P2,100,000. The new machine has an…
A: SOLUTION FORMULA = ACCUMULATED DEPRECIATION (SUM OF THE YEARS DIGIT METHOD) =(COST OF ASSET -…
Q: Bataan Company purchased a machinery that was installed and ready for use on January 1, 2019 at a…
A: Depreciation expense is the cost portion which is allocated to the fixed assets of the company and…
Q: On January 1, 2017, Easy Company acquired an equipment for P8,000,000. The equipment is depreciated…
A: Thanks for the Question Bartleby's Guidelines “Since you have posted a question with multiple…
Q: Lehman Corporation purchased a machine on January 2, 2017, for $4,000,000. The machine has an…
A: The correct answer is option a, that is, $144,000.
Q: On January 1, 2017, Bride Company purchased for P2,400,000 a machine with a useful life of ten years…
A: Double declining depreciation rate = Straight line depreciation rate x 2 = (100/10 years) x 2 = 20%
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: The company purchased on October 1, 2017 an equipment for P850,000. The equipment had an estimated…
A: Depreciation rate=1useful life×2=18×2=0.25 or 25%
Q: 25-3) Colorado Company has been using the sum-of-the-years'-digits depreciation method to depreciate…
A: Sum of the digits = n(n+1) / 2 n = the useful life in years
Q: Workman Company purchased a machine on January 2,2017, for $800,000. The machine has an estimated…
A: Accumulated depreciation: The total amount of depreciation expense deducted, from the time asset…
Q: Judds Company purchased a new plant asset on April 1, 2020, at a cost of $711,000. It was estimated…
A: Solution a. Sum of the years digits method: This is method is in line with diminishing balance…
Q: A company purchased factory equipment on April 1, 2021 for $128,000. It is estimated that the…
A: Depreciation expense: Depreciation expense is the reduction in a particular asset due to its use or…
Q: On January 1, 2017, Windsor Company purchased a building and equipment that have the following…
A:
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: Haemul Pajeon Company purchased a machine on January 2, 2018 for P500,000. The machine has an…
A: Double declining depreciation rate = Straight line depreciation rate x 2 = (100/8 years) x 2 = 25%
Q: On September 1st, 2021 a company purchased a piece of plant equipment for $53,000. In addition to…
A: Depreciation under straight line method: Depreciable amount / Life(in years) Depreciable amount =…
Q: abc company purchased an equipment on september 1, 2015 for $230000. the salvage value of the…
A: Under Sum of Years’ method, depreciation is calculated by dividing the depreciable value of the…
Q: On January 1, 2020, Domino Company purchased a new machine for P4,000,000. The new machine has an…
A: Total Sum-of-the-years'-digits = 1+2+3+4+5+6+7+8 = 36 years Total sum of life remaining at the end…
Q: n January 1, 2018, World Inc. purchased five machines at a cost of $14,000 each. The company adopted…
A: Depreciation is a reduction in the value of assets due to the usage of that asset. We can evaluate…
Q: Jaen Advertising Inc. reported the following on its December 31, 2020, balance sheet: Equipment,…
A: Depreciation is considered as an expense charge on the value of the Asset. It can be calculated by…
Q: January 1, 2014, Bonita Industries purchased equipment at a cost of $361000. The equipment was…
A: The depreciation expense refers to the reduction in the value of assets due to the use of that asset…
Q: Metlock, Inc. purchased a new machine on October 1, 2020, at a cost of $122,000. The company…
A: Depreciation: It refers to a gradual decrease in the fixed asset’s value because of obsolescence,…
Q: On January 1, 2016, Cookie Inc. purchased an equipment for P1,970,000. On this date, the equipment…
A: Depreciation: Depreciation means the reduction in the value of an asset over the life of the assets…
Q: On August 1, 2017, Haima Company places a new asset into service. The cost of the asset is OMR…
A: Calculation of depreciation using SLM- Formula Depreciation per year = (Cost of Asset - salvage…
Q: Ayayai Corporation purchased machinery on January 1, 2022, at a cost of $252,000. The estimated…
A: Fixed asset: It is a long-term asset used in the business for long period and is depreciated for its…
Q: A company purchased a new machine on May 1, 2012 for $528,000. At the time of acquisition, the…
A: Depreciation is a reduction in the value of assets due to the usage of that asset. We can evaluate…
Q: Anna Company purchased an equipment costing P100,000 on July 1, 2016. The equipment has an estimated…
A: Depreciation expense is part of cost of the asset charged as expense in the income statement.…
Q: il 1, 2021, Metro Co. purchased machinery at a cost of $42,000. The machinery is expected to last 10…
A: Solution: Sum of years digits = 10+9+8+7+6+5+4+3+2+1 = 55
Q: On January 1, 2020, Star Inc. purchased equipment for the new plant. The company paid $354,000 for…
A: Accumulated depreciation = Current year depreciation + depreciation till last year
Q: On January 1, 2015, Jersey Corporation purchased for $800,000, equipment having a useful life of ten…
A: Assets are the resources of the business which it has acquired for business purpose. Assets can be…
Q: What depreciation would Murgatroyd record for the year 2018 on this equipment
A: Given information is: On January 1, 2016 Murgatroyd Co. purchased equipment for OMR 30,000,…
Q: On January 1, 2016, Margo Company acquired machinery at a cost of $160,000. This machinery was being…
A: Solution.. Life of the asset = 5 years Rate of depreciation under double Declining method = 200%…
Q: Fontaine Ltd. acquired a machine for $600,000 on January 1, 2022. The machine has a salvage value of…
A: GIVEN THAT, cost of machine = $600000 salvage value of machine = $10000 useful life of machine = 5…
Q: Spiral Company uses the sun-of-the years’ digits method to depreciate equipment purchased in January…
A: Solution: Depreciation is a reduction in the value of an asset over time, due to normal wear and…
Q: On April 21, 2018, OO YAN! Manufacturing Company bought new equipment for P725, 000. The new…
A: Under the sum of year digits method, depreciation is highest in the initial periods and lower in the…
Q: Workman Company purchased a machine on January 2, 2020, for $800,000. The machine has an estimated…
A: Accumulated depreciation: The total amount of depreciation expense deducted, from the time asset…
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- On July 1, 2018, Mundo Corporation purchased factory equipment for 50,000. Residual value was estimated at 2,000. The equipment will be depreciated over 10 years using the double-declining balance method. Counting the year of acquisition as one-half year, Mundo should record 2019 depredation expense of: a. 7,680 b. 9,000 c. 9,600 d. 10,000On 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.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.
- 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.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.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.
- 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?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. $134,000Akron 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.
- Gray Companys financial statements showed income before income taxes of 4,030,000 for the year ended December 31, 2020, and 3,330,000 for the year ended December 31, 2019. Additional information is as follows: Capital expenditures were 2,800,000 in 2020 and 4,000,000 in 2019. Included in the 2020 capital expenditures is equipment purchased for 1,000,000 on January 1, 2020, with no salvage value. Gray used straight-line depreciation based on a 10-year estimated life in its financial statements. As a result of additional information now available, it is estimated that this equipment should have only an 8-year life. Gray made an error in its financial statements that should be regarded as material. A payment of 180,000 was made in January 2020 and charged to expense in 2020 for insurance premiums applicable to policies commencing and expiring in 2019. No liability had been recorded for this item at December 31, 2019. The allowance for doubtful accounts reflected in Grays financial statements was 7,000 at December 31, 2020, and 97,000 at December 31, 2019. During 2020, 90,000 of uncollectible receivables were written off against the allowance for doubtful accounts. In 2019, the provision for doubtful accounts was based on a percentage of net sales. The 2020 provision has not yet been recorded. Net sales were 58,500,000 for the year ended December 31, 2020, and 49,230,000 for the year ended December 31, 2019. Based on the latest available facts, the 2020 provision for doubtful accounts is estimated to be 0.2% of net sales. A review of the estimated warranty liability at December 31, 2020, which is included in other liabilities in Grays financial statements, has disclosed that this estimated liability should be increased 170,000. Gray has two large blast furnaces that it uses in its manufacturing process. These furnaces must be periodically relined. Furnace A was relined in January 2014 at a cost of 230,000 and in January 2019 at a cost of 280,000. Furnace B was relined for the first time in January 2020 at a cost of 300,000. In Grays financial statements, these costs were expensed as incurred. Since a relining will last for 5 years, Grays management feels it would be preferable to capitalize and depreciate the cost of the relining over the productive life of the relining. Gray has decided to nuke a change in accounting principle from expensing relining costs as incurred to capitalizing them and depreciating them over their productive life on a straight-line basis with a full years depreciation in the year of relining. This change meets the requirements for a change in accounting principle under GAAP. Required: 1. For the years ended December 31, 2020 and 2019, prepare a worksheet reconciling income before income taxes as given previously with income before income taxes as adjusted for the preceding additional information. Show supporting computations in good form. Ignore income taxes and deferred tax considerations in your answer. The worksheet should have the following format: 2. As of January 1, 2020, compute the retrospective adjustment of retained earnings for the change in accounting principle from expensing to capitalizing relining costs. Ignore income taxes and deferred tax considerations in your answer.Bliss Company owns an asset with an estimated life of 15 years and an estimated residual value of zero. Bliss uses the straight -line method of depreciation. At the beginning of the sixth year, the assets book value is 200,000 and Bliss changes the estimate of the assets life to 25 years, so that 20 years now remain in the assets life. Explain how this change will be accounted for in Blisss financial statements, and compute the current and future annual depreciation expense.On May 1, 2015, Zoe Inc. purchased Branta Corp. for $15,000,000 in cash. They only received $12,000,000 in net assets. In 2016, the market value of the goodwill obtained from Branta Corp. was valued at $4,000,000, but in 2017 it dropped to $2,000,000. Prepare the journal entry for the creation of goodwill and the entry to record any impairments to it in subsequent years.