Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of $45,900. The machine's useful life is estimated at 10 years, or 389,000 units of product, with a $7,000 salvage value. During its second year, the machine produces 32,900 units of product.
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Q: Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the…
A: Under Units of production method : Depreciation =(Cost of asset - salvage value )×Actual Units…
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A: Depreciation under straight-line method = ( Historical cost- Salvage value)/Useful life Depreciation…
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A: Depreciation is the reduction in the value of an asset over a useful life of the asset. It is an…
Q: Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the…
A: Formula: Depreciation expense per unit = ( Total cost - salvage value ) / Number of units
Q: Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the…
A:
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A: Journal is the recording of financial transactions according to dual entity concept.
Q: Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the…
A: Lets understand the basics. Depreciation is a reduction in value of asset due to wear and tear,…
Q: Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the…
A: Deprecioation expense per unit = (Cost - Salvage value)/Total units of production
Q: Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the…
A: Depreciation rate=1Useful life×2=110×2=20%
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…
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Q: [The following information applies to the questions displayed below.] Ramirez Company installs a…
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Q: Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the…
A: With the passage of time, the value of machinery goes on decreasing due to normal wear or tear,…
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A: Straight line depreciation = ( Initial Cost - Salvage Value ) / Estimated useful life…
Q: Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the…
A: Depreciation per unit (Units of production method) =(cost of Asset - salvage value ) / Estimated…
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A: Refer step1 & step2 for complete understanding
Q: Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the…
A: Depreciation represents the reduction in the value of an asset over a useful life of the asset. It…
Q: Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the…
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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…
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Q: Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the…
A: Depreciation is the expenses which is actually the charge or usage of asset during the period.…
Q: Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the…
A: Annual depreciation as per straight line method = (Cost - Salvage value)/Useful life
Q: Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the…
A: Because an asset is bound to experience wear and tear over time, depreciation must be provided. This…
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A: Depreciation is the gradual decline that occurs in the asset’s value. It is recorded as a non-cash…
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- During the current year, Arkells Inc. made the following expenditures relating to plant machinery. Renovated five machines for $100,000 to improve efficiency in production of their remaining useful life of five years Low-cost repairs throughout the year totaled $70,000 Replaced a broken gear on a machine for $10,000 A. What amount should be expensed during the period? B. What amount should be capitalized during the period?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.During the current year, Arkells Inc. made the following expenditures relating to plant machinery. Renovated seven machines for $250,000 to improve efficiency in production of their remaining useful life of eight years Low-cost repairs throughout the year totaled $79,000 Replaced a broken gear on a machine for $6,000 A. What amount should be expensed during the period? B. What amount should be capitalized during the period?
- Grandorf Company replaced the engine in a truck for 8,000 and expects the new engine will extend the life of the truck two years beyond the original estimated life. Related information is provided below. Cost of truck 65,000 Salvage value 5,000 Original estimated life 6 years The truck was purchased on January 1, 20-1. The engine was replaced on January 1, 20-6. Using straight-line depreciation, compute depreciation expense for 20-6.Urquhart Global purchases a building to house its administrative offices for $500,000. The best estimate of the salvage value at the time of purchase was $45,000, and it is expected to be used for forty years. Urquhart uses the straight-line depreciation method for all buildings. After ten years of recording depreciation, Urquhart determines that the building will be useful for a total of fifty years instead of forty. Calculate annual depreciation expense for the first ten years. Determine the depreciation expense for the final forty years of the assets life, and create the journal entry for year eleven.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 it expects to use the truck for 26,000 miles. Calculate the annual depreciation expense.
- 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.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.To test your formulas, assume the machine purchased had an estimated useful life of three years (20,000, 30,000, and 50,000 hours, respectively). Enter the new information in the Data Section of the worksheet. Does your depreciation total 320,000 under all three methods? There are three common errors made by students completing this worksheet. Lets clear up two of them. One, an asset that has a three-year life should have no depreciation claimed in Year 4. This can be corrected using an =IF statement in Year 4. For example, the correct formula in cell C32 is =IF(B32D9,0,(D7D8)/D9) or =IF(B32D9, 0, SLN(D7, D8, D9)). You may wish to edit what you have already entered rather than retype it. Two, as mentioned in requirement 2, the double-declining-balance calculation needs to be modified in the last year of the assets life. Assuming you have already modified the formula for Year 4 (per instructions in step 2), alter the formula for Year 3 also. If you corrected any formulas, test their correctness by trying different estimated useful lives (between 3 and 8) in cell E9. Then reset the Data Section to the original values, save the revised file as DEPREC2, and reprint the worksheet to show the correct formulas. The third common error doesnt need to be corrected in this problem. The general form of the double-declining-balance formula needs to be modified to check the net book value of the asset each year to make sure it does not go below salvage value. =DDB does this automatically, but if you are writing your own formulas, this gets very complicated and is beyond the scope of the problem.
- 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?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.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.