Problem 3: The initial cost of a paint sand mill, including its installation is P 800,000. The depreciable life of this machine is 10 years with an estimated salvage value of P 50,000. Using SYD Method -Compute the depreciation charge on the 6th year. -Compute the total depreciation after 6 years. -Compute the book value after 6 years.
Q: Book Co. has 1.9 million shares of common equity with a par (book) value of $1.50, retained earnings...
A: The market value of equity is used to define the value of a company in the open market. The market v...
Q: Equity: 120,000 shares at $1 each. Share premium: $22,000 The company decides to issue 1:3 shares....
A: Share Premium- This is the amount which is over and excess of nominal value. If Say for example if n...
Q: Are the two options shown below equivalent in paying off the loan?
A: Present Worth: It is the present value of the future annual cash flows and is calculated by discoun...
Q: Out of which equation is NOT CORRECT ? Please remember to select "WHICH IS NOT CORRECT" Select one: ...
A: Answer - Total Liabilities = Total Assets - Shareholder's funds - Capital. This equation is incorr...
Q: 8. Bond Pricing. A 6-year Circular File bond with face value $1,000 pays interest once a year of $80...
A: Coupon rate means the coupon payments as a percentage of the face value of bonds, whereas yield to m...
Q: a) How much are you going to pay at the end of 2 years at a simple interest rate of 12% per year? b)...
A: Simple Interest: It is the easiest method of computing interest loans. It is computed by multiplyin...
Q: In planning for your retirement, you expect to save $500 in year 1, $1500 in year 2, and amounts inc...
A: As you have asked multiple questions, we will solve the first question as per the policy presented b...
Q: 3BB company had cash and marketable securities worth $400,134 accounts ables worth $2,490,357, inven...
A: Since you have posted a multiple question so we will be solving the first question for you only. if ...
Q: The Security Market Line is a ugh the
A: In the world of finance an important relationship exists between risks and returns.
Q: A man deposits P5,000 at the end of every year earning 7.50% compounded continuously. Determine the ...
A: Annual deposit (P) = P5000 Interest rate = 7.50% e = 2.7182818284590452353602874713527 Annual intere...
Q: The current price of silver is $206 per ounce. The storage cost is $1 ounce per year, payable quarte...
A: Current price = $206 Quarterly storage cost payable in advance (q) = $1 = $0.25 Interest rate (r) = ...
Q: Christina Company (a U.S.-based company) has a subsidiary in Canada that began operations at the sta...
A: Answer - Computation of Translation Adjustment - Particular CAD Exchange Rate USD Net Ass...
Q: How do I calculate and record the related after tax cash flow effect(s)?
A: FOLLOWING IS THE ANSWER:
Q: what does it mean if the npv and irr are both negative quora, should the company invest in the proje...
A: Capital Budgeting entails long-term planning and monitoring of capital expenditures, as well as a ra...
Q: - 42. Abby C. Dee borrowed P10,620.00 from Jakey L. Em on October 30, 2020 simple interest rate. How...
A: Amount borrowed (X) = P 10620 n = 4 months r = 8% He needed to pay at the end of Feb 2021, but paid ...
Q: Sewing World has an all-equity cost of capital of 11.72 percent, a levered cost of equity of 12.94 p...
A: A firm raises finance from various sources typically debt and Equity. The ratio of debt finance to E...
Q: what is ADVANTAGES AND DISADVANTAGES OF THIS MORATORIUM FOR THE BANKS AND BORROWERS? provide EXAMPLE...
A: A moratorium is a temporary cessation of activity until future circumstances necessitate its lifting...
Q: What is the purpose and workings of the Monetary policy transmission mechanism (MPTM)? What are the ...
A: Monetary transmission technique or the mechanism is referred to as the process through which the pri...
Q: a)A project has 6 million cashflow each year for 5years, payback period of 4 years and rate of retu...
A: Thanks for the Question: Bartleby's Guideline: “Since you have asked multiple question, we will solv...
Q: The government received a loan of 7 million monetary units at 10% per year (expenditure). These fund...
A: Loan is a situation where the individual or the company or government or any other party borrows mon...
Q: O Support Dashboard e Bradley After-Tax Cash Flows Below is a list of aspects situations assume a 40...
A:
Q: Financial Institutions are intermediaries that play a vital role in nation-building. They source fun...
A: Financial institutions are vital because they create a marketplace for money and assets, allowing ca...
Q: Communications does not currently pay a dividend. You expect the company to begin paying a dividend ...
A: Price of stock can be determined from the constant growth dividend model considering the growth rate...
Q: Use the Fisher Effect/equation. A $1,000 Par value, 3% Coupon bond with 10 years to maturity is tra...
A: The Fisher effect states that the nominal interest rate changes with the change in inflation. It is ...
Q: Peter makes a deposit at the end of every month into a savings account that earns interest at 5.4% c...
A: A series of equal payments at equal intervals of time is called annuity. Pension payments, mortgage ...
Q: How long will it take to double your savings if you earn 3.6 percent interest, compounded annually? ...
A: The number of years required can be solved with the help of NPER function of Excel
Q: For DePaul Inc. what is the return for year 2. Round to no decimal points and use the % symbol (27%....
A: As per our guidelines, we are supposed to answer only 3 sub-parts (if there are multiple sub-parts a...
Q: List each of the key financial statements and identify the kinds of information they provide to corp...
A: Note : As per the guidelines, only first question will be answered. Kindly post the remaining parts ...
Q: A seller is considering extending trade credit to an existing customer that buys on cash terms. The ...
A: Total units in case of credit = 400 + 10 = 410 Unit sale price = $100 Unit variable cost = $65 r = 7...
Q: Five deposits are made at the EOYS of years 2021-2025, as shown in the CF table above. If the intere...
A: Interest Rate = 6% Time Period = 10 Years
Q: a. What is the price (expressed as a percentage of the face value) of a 1-year, zero-coupon corpo...
A:
Q: Divanee is a Neurosurgeon at the local hospital. However, the long hours have been very draining, an...
A: Tax deduction is referred as the benefit that the tax payer gets on his or her taxable income by pro...
Q: Suppose a world has two risky assets: StkC and StkD. The following table shows the holding period re...
A: First, we will calculate the Expected Return for Stock C and Stock D then we will find out the Stand...
Q: Mr. Whitaker works for Dawn Industries. His family is covered by one health insurance policy. He pay...
A:
Q: Josh Liu has been investing in the stock market for several years, beginning when he was a freshman ...
A: Hi There, thanks for posting the question. But as per Q&A guidelines, we must answer the first t...
Q: A man wants to recieve P800 immediately and pay it back in one year. The bank charges a simple disco...
A: Borrowings/Mortgage are the loan which is taken by the individual to meet its financial requirements...
Q: Consider the following cash flows: Year 0 1 2 3 4 5 6 Cash Flow -$9,000 $2,000 ...
A: NPV: It stands for Net Present value. It is the difference between PV (Present value) of cash inflow...
Q: Please show work. Thank you
A: The future value is calculated as per time value equation
Q: Bailey, Inc., is considering buying a new gang punch that would allow them to produce circuit boards...
A: MARR is the minimum rate that a company is willing to earn from a project. It is also known as the b...
Q: Which of the following is the most advantageous for a debtor if he borrowed P15, 000 at 6% from Marc...
A: Borrowed amount is P15,000 Interest rate is 6% Starting date is March 15, 2020 Ending date is Decemb...
Q: Peter makes a deposit at the end of every month into a savings account that earns interest at 5.4% c...
A: There is need of proper financial planning for the future needs and there is need proper savings nee...
Q: Gold is currently trading at $1,645.50 per ounce with a carrying cost price of $1,693.97 per ounce f...
A: Trading profit is the same as operating profit. As a result, it excludes any financing-related reven...
Q: A man borrowed P400,000 from a lending institution which will be paid after 10 years at an interest ...
A: Compounding is a process where the investor or trader pays interest on interest. In this the interes...
Q: Peter makes a deposit at the end of every month nto a savings account that earns interest at 5.4% om...
A: There is need of financial planning needed for needs of tomorrow so we should prepare systematically...
Q: f the Bank of England wanted to discourage investment sp ggregate demand, it could Select one: O a. ...
A: Bank of England do open market operations to implement the policies regarding the economy and growth...
Q: te
A: Introduction : The given question relates to the capital budgeting techniques which are used to valu...
Q: Star Light & Power increases its dividend 2.6 percent per year every year. This utility is valued us...
A: The dividend discount model (DDM) is a quantitative method used for predicting the worth of a compan...
Q: YYYYMM Return(Stk1) Return(Stk2) Return(Market) Return(T-bill) 201701 7.75% 3.00% 6.18% 0.20% 201702...
A: The Capital Asset Pricing Model (CAPM) is a mathematical model that explains the relationship betwee...
Q: What are the most important tactics that small companies can use to ensure their long-term financial...
A: Financial security is very important for small companies to sustain over the long period of time.
Q: Consider a loan of $98,000 at 7% compounded annually, with 12 annual payments. Find the following. (...
A: Loan amortization can be defined as the procedure of amortizing the loan in such a way that the loan...
Problem 3: The initial cost of a paint sand mill, including its installation is P 800,000. The
-Compute the depreciation charge on the 6th year.
-Compute the total depreciation after 6 years.
-Compute the book value after 6 years.
Trending now
This is a popular solution!
Step by step
Solved in 4 steps
- Montezuma Inc. purchases a delivery truck for $20,000. The truck has a salvage value of $8,000 and is expected to be driven for ten years. Montezuma uses the straight-line depreciation method. Calculate the annual depreciation expense. After five years of recording depreciation, Montezuma determines that the delivery truck will be useful for another five years (ten years in total, as originally expected) and that the salvage value will increase to $10,000. Determine the depreciation expense for the final five years of the assets life, and create the journal entry for years 6–10 (the entry will be the same for each of the five years).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.Montezuma 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. Montezuma uses the straight-line depreciation method. Calculate the annual depreciation expense. After three years of recording depreciation, Montezuma determines that the delivery truck will only be useful for another three years and that the salvage value will increase to $4,000. Determine the depreciation expense for the final three years of the assets life, and create the journal entry for year four.
- IMPACT OF IMPROVEMENTS AND REPLACEMENTS ON THE CALCULATION OF DEPRECIATION On January 1, 20-1, Dans Demolition purchased two jackhammers for 2,500 each with a salvage value of 100 each and estimated useful lives of four years. On January 1, 20-2, a stronger blade to improve performance was installed in Jackhammer A for 800 cash and the compressor was replaced in Jackhammer B for 200 cash. The compressor is expected to extend the life of Jackhammer B one year beyond the original estimate. REQUIRED 1. Using the straight-line method, prepare general journal entries for depreciation on December 31, 20-1, for Jackhammers 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 jackhammer for 20-2 through 20-4.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 120,000 miles. Montello uses the units-of-production depreciation method and in year one it expects to use the truck for 23,000 miles. 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 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.
- 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?A machine costing 350,000 has a salvage value of 15,000 and an estimated life of three years. Prepare depreciation schedules reporting the depreciation expense, accumulated depreciation, and book value of the machine for each year under the double-declining-balance and sum-of-the-years-digits methods. For the double-declining-balance method, round the depreciation rate to two decimal places.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.
- IMPACT 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.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.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.