1)
Introduction:
The depreciation expense for the years 2021 and 2022
2)
Introduction: Depreciation links the cost of using a tangible item to the benefit received throughout its useful life. The accumulated depreciation account contains the amount charged for depreciation on the balance sheet.
The depreciation expense for the years 2021 and 2022
3)
Introduction: Depreciation links the cost of using a tangible item to the benefit received throughout its useful life. The accumulated depreciation account contains the amount charged for depreciation on the balance sheet.
The depreciation expense for the years 2021 and 2022
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Chapter 11 Solutions
INTERMEDIATE ACCOUNTING (ACCT 3200B)
- The following transactions occurred during 2025. Assume that depreciation of 10% per year is charged on all machinery and 5% per year on buildings, on a straight-line basis, with no estimated salvage value. Depreciation is charged for a full year on all fixed assets acquired during the year, and no depreciation is charged on fixed assets disposed of during the year. Jan. 30 Mar. 10 Mar. 20 May 18 June 23 A building that cost $137,280 in 2008 is torn down to make room for a new building. The wrecking contractor was paid $5,304 and was permitted to keep all materials salvaged. Date Machinery that was purchased in 2018 for $16,640 is sold for $3,016 cash, f.o.b. purchaser's plant. Freight of $312 is paid on the sale of this machinery. A gear breaks on a machine that cost $9,360 in 2017. The gear is replaced at a cost of $2,080. The replacement does not extend the useful life of the machine but does make the machine more efficient. A special base installed for a machine in 2019 when the…arrow_forwardThe following transactions occurred during 2025. Assume that depreciation of 10% per year is charged on all machinery and 5% per year on buildings, on a straight-line basis, with no estimated salvage value. Depreciation is charged for a full year on all fixed assets acquired during the year, and no depreciation is charged on fixed assets disposed of during the year. Jan. 30 Mar. 10 Mar. 20 May 18 June 23 A building that cost $155,760 in 2008 is torn down to make room for a new building. The wrecking contractor was paid $6,018 and was permitted to keep all materials salvaged. Machinery that was purchased in 2018 for $18,880 is sold for $3,422 cash, fo.b. purchaser's plant. Freight of $354 is paid on the sale of this machinery. A gear breaks on a machine that cost $10,620 in 2017. The gear is replaced at a cost of $2,360. The replacement does not extend the useful life of the machine but does make the machine more efficient. A special base installed for a machine in 2019 when the machine…arrow_forwardThe following transactions occurred during 2025. Assume that depreciation of 10% per year is charged on all machinery and 5% per year on buildings, on a straight-line basis, with no estimated salvage value. Depreciation is charged for a full year on all fixed assets acquired during the year, and no depreciation is charged on fixed assets disposed of during the year. Jan. 30 Mar. 10 Mar. 20 May 18 June 23 A building that cost $139,920 in 2008 is torn down to make room for a new building. The wrecking contractor was paid $5,406 and was permitted to keep all materials salvaged. Date Machinery that was purchased in 2018 for $16,960 is sold for $3,074 cash, f.o.b. purchaser's plant. Freight of $318 is paid on the sale of this machinery. A gear breaks on a machine that cost $9,540 in 2017. The gear is replaced at a cost of $2,120. The replacement does not extend the useful life of the machine but does make the machine more efficient. A special base installed for a machine in 2019 when the…arrow_forward
- On October 1, 2021, the Allegheny Corporation purchased equipment for $123,000. The estimated service life of the equipment is 10 years and the estimated residual value is $2,000. The equipment is expected to produce 220,000 units during its life. Required: Calculate depreciation for 2021 and 2022 using each of the following methods. Partial-year depreciation is calculated based on the number of months the asset is in service. Double-declining-balance. Double-Declining-Balance Method Choose Numerator: x Choose Denominator: x Fraction of = Depreciation Expense Formula Beginning Book Value x Double the Straight-line Rate x Fraction of Year = Depreciation Amount for 2021 $ _________________ x __________________ % x _____________ = _________ Amount for 2022 $_________________ x…arrow_forwardAn equipment has a total depreciation of P35,000 at the end of first year. If the First cost is P140,000 and the salvage value is P10,000. Calculate the uselife by double declining balance method of depreciation.arrow_forwardOn January 1, 2021, the Allegheny Corporation purchased equipment for $115,000. The estimated service life of the equipment is 10 years and the estimated residual value is $5,000. The equipment is expected to produce 220,000 units during its life.Required:Calculate depreciation for 2021 and 2022 using each of the following methods. Round all computations to the nearest dollar.1. Straight line2. Double-declining balance3. Units of production (units produced in 2021, 30,000; units produced in 2022, 25,000)arrow_forward
- Determine the rate of depreciation, the total depreciation up to the end of the 8th year and the book value at the end of 8 years for an asset that cost P15,000 new and has an estimated scrap value of P2,000 at the end of 10 years by (a) declining balance method and (b) the double declining balance method.arrow_forwardCompany provided the following information on January 1, 2019: Vehicle cost 5,000,000 Useful life in years 5 years Useful life in miles 100,000 miles Residual value 1,000,000 Actual Miles driven: 2019 30,000 2020 20,000 2021 15,000 What is the depreciation for 2021 using the Sum-of-years digit method?arrow_forwardOn September 20, 2020, Shamille Company purchased machinery for P7,600,000. Residual value wasestimated to be P400,000. The machinery is depreciated over eight years using the sum of the years’ digitsmethod. Depreciation is computed on the basis of the nearest fullest month. What amount should be recordedas depreciation for 2021?A. 1,450,000B. 1,600,000C. 1,550,000D. 1,400,000arrow_forward
- Calculate depreciation. A machine cost $165,000 on April 28, 2021. Its estimated salvage value is $5,000 and its expected life is eight years. Instructions Prepare a depreciation schedule for each year using each of the following methods, showing the figures used. These schedules should have formulas in the cells referencing the "input section" that was discussed previously. (a) Straight-line (b) Double-declining-balance (c) Sum-of-the-years'-digitsarrow_forwardThe cost of an asset is $1,200,000, and its residual value is $100,000. Estimated useful life of the asset is five years. Calculate depreciation for the second year using the double-declining-balance method of depreciation. (Do not round any intermediate calculations, and round your final answer to the nearest dollar.)arrow_forwardAssuming the machine is depreciated using SYD and estimated residual value of P120,000 after its 6 years of physical life. The recoverable amount of the machine at the end of 2022 and 2023, respectively were P3,100,000 and P2,400,000. What is the amount of gain on recovery and revaluation surplus for the period ending December 31, 2023?arrow_forward
- AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
- Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSONIntermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill EducationFinancial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
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