Problem 24-21 (ACP) ABC Company acquired an equipment on January 1, 2008. The asset has an estimated life of 4 years. An employee has prepared a depreciation schedule for this equipment using two methods, straight line and double declining balance, as follows: Straight line Double declining 2008 2009 2010 2011 1,500,000 1,500,000 1,500,000 1,500,000 6,000,000 What was the acquisition cost of the equipment? a. 6,000,000 b. 6,500,000 c. 8,125,000 d. 7,000,000 3,250,000 1,625,000 812,500 312,500 6,000,000

Problem 24-21 (ACP) ABC Company acquired an equipment on January 1, 2008. The asset has an estimated life of 4 years. An employee has prepared a depreciation schedule for this equipment using two methods, straight line and double declining balance, as follows: Straight line Double declining 2008 2009 2010 2011 1,500,000 1,500,000 1,500,000 1,500,000 6,000,000 What was the acquisition cost of the equipment? a. 6,000,000 b. 6,500,000 c. 8,125,000 d. 7,000,000 3,250,000 1,625,000 812,500 312,500 6,000,000

Name: Problem 24-21 (ACP)ABC Company acquired an equipment on January 1, 20
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Description: Problem 24-21 (ACP)ABC Company acquired an equipment on January 1, 2008. Theasset has an estimated life of 4 years. An employee has prepared adepreciation schedule for this equipment using two methods,straight line and double declining balance, as f

Corporate Financial Accounting

14th Edition

ISBN:9781305653535

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter9: Long-term Assets: Fixed And Intangible

Section: Chapter Questions

Problem 9.17EX: Entries for sale of fixed asset Equipment acquired on January 8 at a cost of 168,000 has an...

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Entries for sale of fixed asset Equipment acquired on January 8 at a cost of 168,000 has an estimated useful life of 18 years, has an estimated residual value of 15,000, and is depreciated by the straight-line method. A. What was the book value of the equipment at December 31 the end of d1e fourd1 year? B. Assuming that the equipment was sold on April 1 of the fifth year for 125,000, Journalize the entries to record (1) depreciation for the three months until the sale date, and (2) the sale of the equipment.
Communication Godwin Co. owns three delivery trucks. Details for each truck at the end of the most recent year follow: Age Expected Useful Life Initial Cost Accumulated Depreciation Truck 1 3 6 22,500 11,250 Truck 2 5 6 26,250 21,875 Truck 3 2 6 28,500 9,500 At the beginning of the year, a hydraulic lift is added to Truck 1 at a cost of 4,500. The addition of the hydraulic lift will allow the company to deliver much larger objects than could previously be delivered. At the beginning of the year, the engine of Truck 2 is overhauled at a cost of 5,000. The engine overhaul will extend the trucks useful life by three years. Write a short memo to Godwins chief financial officer explaining the financial statement effects of the expenditures associated with Trucks 1 and 2.
Exercise 8-4: Koffman’s Warehouse purchased a forklift on January 1, 2016, for $6,000. The forklift is expected to last for five years and has a residual value of $600. Koffman’s uses the double-declining-balance method for depreciation. Calculate the depreciation expense, accumulated depreciation, and book value for each year of the forklifts life. Prepare the journal entry to record depreciation expense for 2016. What factors may have influenced Koffman to use the double-declining-balance method?
Question 1 On April 02, 2009 the Global Company acquired equipment. It has estimated useful life of 5 years with salvage value Rs. 5,000 the following expenditure were incurred on it. Billed Price Rs. 275,000. Freight Charges Rs. 2,000 and Transit Insurance Rs. 3,000. Installation Expenses Rs. 25,000 Three years Fire Insurance Rs. 15,000. Company close its accounting period on Dec 31, of every year, and use reducing balance method @ 10% to record depreciation. Instruction: Compute the Cost of Equipment. Compute the Depreciation for 2009 and 2010 Record the Depreciation of 2011 in general Journal.
26. A company purchased equipment valued at $200,000 on January 1. The equipment has an estimated useful life of eight years. The equipment is estimated to have a salvage value of $10,000. Assuming the double declining balance method of depreciation, what is the depreciation for the second year?A $33,333B. $35,625C. $31,667D. $47,500
Exercise 9-08 On July 1, 2019, Ivanhoe Company purchased new equipment for $90,000. Its estimated useful life was 5 years with a $12,000 salvage value. On December 31, 2022, the company estimated that the equipment’s remaining useful life was 10 years, with a revised salvage value of $5,000. Prepare the journal entry to record depreciation on December 31, 2019. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Debit Credit enter an account title enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount SHOW LIST OF ACCOUNTS LINK TO TEXT Prepare the journal entry to record depreciation on…
24.The Danica Company self constructed an asset for its own use. Construction started on January 1, 2021 and the asset was completed on October 31, 2021. Costs incurred during the period of construction were as follows:January 1-P400,000 April 1-P500,000 August 1-P480,000October 1-P180,000 At the beginning of the year, the company obtained a two-year, 18% loan of P500,000, specifically to finance the asset construction. In addition to the specific borrowing, prior to the construction, Danica Company had a general borrowing amounting to P600,000 with interest of 15% and a five-year term that was used in part in the self construction.What is the total cost of the self constructed asset? a. 1,686,500 b. 1,711,800 c. 1,728,000 d. 1,770,000
Exercise 9-09 (Video) Presented below are selected transactions at Monty Corp. for 2020. Jan. 1 Retired a piece of machinery that was purchased on January 1, 2010. The machine cost $61,900 on that date. It had a useful life of 10 years with no salvage value. June 30 Sold a computer that was purchased on January 1, 2017. The computer cost $31,200. It had a useful life of 5 years with no salvage value. The computer was sold for $14,600. Dec. 31 Discarded a delivery truck that was purchased on January 1, 2016. The truck cost $37,980. It was depreciated based on a 6-year useful life with a $3,000 salvage value. Journalize all entries required on the above dates, including entries to update depreciation, where applicable, on assets disposed of. Monty Corp. uses straight-line depreciation. (Assume depreciation is up to date as of December 31, 2019.) (Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in…
Problem 4 XYZ Company purchases a machine On January 1, 2014 for $100,000 with an estimated residual value of $10,000 and useful life of four years. Use the double-declining balance method. Prepare the journal entry to record depreciation for 2016. If possible, compute the carrying value at the end of 2016. Determine the amount of depreciation expense in 2017.
Exercise 10-24 On December 31, 2020, Vaughn Inc. has a machine with a book value of $1,353,600. The original cost and related accumulated depreciation at this date are as follows. Machine $1,872,000 Less: Accumulated depreciation 518,400 Book value $1,353,600 Depreciation is computed at $86,400 per year on a straight-line basis.Presented below is a set of independent situations. For each independent situation, indicate the journal entry to be made to record the transaction. Make sure that depreciation entries are made to update the book value of the machine prior to its disposal. Your answer is partially correct. Try again. A fire completely destroys the machine on August 31, 2021. An insurance settlement of $619,200 was received for this casualty. Assume the settlement was received immediately. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If…
Exercise 9-10Pryce Company owns equipment that cost $55,050 when purchased on January 1, 2012. It has been depreciated using the straight-line method based on estimated salvage value of $4,000 and an estimated useful life of 5 years. Prepare Pryce Company’s journal entries to record the sale of the equipment in these four independent situations. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to 0 decimal places, e.g.125.) (a) Sold for $31,630 on January 1, 2015.(b) Sold for $31,630 on May 1, 2015.(c) Sold for $10,710 on January 1, 2015.(d) Sold for $10,710 on October 1, 2015. No.Account Titles and ExplanationDebitCredit(a) (b) (To record depreciation) (To record sale of equipment) (c) (d) (To record depreciation) (To record sale of equipment)