Cornerstones of Financial Accounting
4th Edition
ISBN: 9781337690881
Author: Jay Rich, Jeff Jones
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Question
Chapter 7, Problem 80.1C
To determine
Introduction:
To choose:
What method of depreciation does Verizon use?
What are the typical useful lives of Verizon’s operating assets?
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
Recording lump-sum asset purchases, depreciation, and disposals
Whitney Plumb Associates surveys American eating habits. The company’s account; include Land, Buildings, Office Equipment, and Communication Equipment, with a separate Accumulated Depreciation account for each asset. During 2018, Whitney Plumb completed the following transactions:
Record the transactions in the journal of Whitney Plumb Associates.
Recording lump-sum asset purchases, depreciation, and disposals
Ellie Johnson Associates surveys American eating habits. The company’s accounts include Land, Buildings, Office Equipment, and Communication Equipment, with a separate Accumulated Depreciation account for each depreciable asset. During 2018, Ellie Johnson Associates completed the following transactions:
Record the transactions in the journal of Ellie Johnson Associates.
I need to know how to calculate the gain on the equipment sold in part C
The balance sheets of HiROE Inc. showed the following at December 31, 2020 and 2019:
December 31, 2020
December 31, 2019
Equipment, less accumulated depreciation of $212,625 at December 31, 2020, and $151,875 at December 31, 2019.
$
273,375
$
334,125
Required:
If there have not been any purchases, sales, or other transactions affecting this equipment account since the equipment was first acquired, what is the amount of the depreciation expense for 2020?
Assume the same facts as in part a, and assume that the estimated useful life of the equipment to HiROE Inc., is eight years and that there is no estimated salvage value. Determine:
What the original cost of the equipment was.
What depreciation method is apparently being used.
When the equipment was acquired.
Assume that this equipment account represents the cost of 5 identical machines. Prepare the horizontal model and record the journal…
Chapter 7 Solutions
Cornerstones of Financial Accounting
Ch. 7 - Prob. 1DQCh. 7 - Prob. 2DQCh. 7 - How does the cost concept affect accounting for...Ch. 7 - Prob. 4DQCh. 7 - Prob. 5DQCh. 7 - Prob. 6DQCh. 7 - What factors must be known or estimated in order...Ch. 7 - How do the accelerated and straight-line...Ch. 7 - Prob. 9DQCh. 7 - Prob. 10DQ
Ch. 7 - Prob. 11DQCh. 7 - Prob. 12DQCh. 7 - Prob. 13DQCh. 7 - Prob. 14DQCh. 7 - Prob. 15DQCh. 7 - Prob. 16DQCh. 7 - Prob. 17DQCh. 7 - Prob. 18DQCh. 7 - Prob. 1MCQCh. 7 - Prob. 2MCQCh. 7 - When depreciation is recorded each period, what...Ch. 7 - Prob. 4MCQCh. 7 - Refer to the information for Cox Inc. above. What...Ch. 7 - Refer to the information for Cox Inc. above. What...Ch. 7 - Which of the following statements is true...Ch. 7 - Normal repair and maintenance of an asset is an...Ch. 7 - Chapman Inc. purchased a piece of equipment in...Ch. 7 - Bradley Company purchased a machine for $34,000 on...Ch. 7 - Prob. 11MCQCh. 7 - Which of the following statements is true? a. The...Ch. 7 - Prob. 13MCQCh. 7 - Heston Company acquired a patent on January 1,...Ch. 7 - Prob. 15MCQCh. 7 - ( Appendix 7 A) Murnane Company purchased a...Ch. 7 - Prob. 17CECh. 7 - Prob. 18CECh. 7 - Straight-Line Depreciation Refer to the...Ch. 7 - Prob. 20CECh. 7 - Prob. 21CECh. 7 - Revision of Depreciation On January 1, 2017, Slade...Ch. 7 - Disposal of an Operating Asset On August 30,...Ch. 7 - Prob. 24CECh. 7 - Cost of Intangible Assets Advanced Technological...Ch. 7 - Prob. 26CECh. 7 - Prob. 27CECh. 7 - (Appendix 7A) Impairment Brown Industries had two...Ch. 7 - Prob. 29BECh. 7 - Acquisition Cost Desert State University installed...Ch. 7 - Depreciation Concepts Listed below are concepts...Ch. 7 - Depreciation Methods On January 1, 2019, Loeffler...Ch. 7 - Expenditures After Acquisition Listed below are...Ch. 7 - Revision of Depreciation On January 1, 2019, the...Ch. 7 - Disposal of an Operating Asset Jolie Company owns...Ch. 7 - Analyzing Fixed Assets Pitt reported the following...Ch. 7 - Prob. 37BECh. 7 - Prob. 38BECh. 7 - ( Appendix 7A) Impairment Listed below is...Ch. 7 - Prob. 40ECh. 7 - Prob. 41ECh. 7 - Prob. 42ECh. 7 - Prob. 43ECh. 7 - Cost of a Fixed Asset Colson Photography Service...Ch. 7 - Prob. 45ECh. 7 - Cost and Depreciation On January 1, 2019, Quick...Ch. 7 - Characteristics of Depreciation Methods Below is a...Ch. 7 - Prob. 48ECh. 7 - Depreciation Methods Clearcopy, a printing...Ch. 7 - Depreciation Methods Quick-as-Lightning, a...Ch. 7 - Inferring Original Cost Barton Construction...Ch. 7 - Choice Among Depreciation Methods Walnut Ridge...Ch. 7 - Revision of Depreciation On January 1, 2017,...Ch. 7 - Capital versus Revenue Expenditure Warrick Water...Ch. 7 - Expenditures After Acquisition The following...Ch. 7 - Expenditures After Acquisition Roanoke...Ch. 7 - Prob. 57ECh. 7 - Prob. 58ECh. 7 - Disposal of Fixed Asset Pacifica Manufacturing...Ch. 7 - Prob. 60ECh. 7 - Prob. 61ECh. 7 - Prob. 62ECh. 7 - Balance Sheet Presentation The following...Ch. 7 - Prob. 64ECh. 7 - Prob. 65ECh. 7 - Prob. 66ECh. 7 - Prob. 67ECh. 7 - Financial Statement Presentation of Operating...Ch. 7 - A Cost of a Fixed Asset Mist City Car Wash...Ch. 7 - Depreciation Methods Hansen Supermarkets purchased...Ch. 7 - Depreciation Schedules Wendt Corporation acquired...Ch. 7 - Expenditures After Acquisition Pasta, a restaurant...Ch. 7 - Prob. 73APSACh. 7 - Prob. 74APSACh. 7 - Prob. 75APSACh. 7 - Prob. 76APSACh. 7 - Prob. 68BPSBCh. 7 - Cost of a Fixed Asset Metropolis Country Club...Ch. 7 - Depreciation Methods Graphic Design Inc. purchased...Ch. 7 - Depreciation Schedules Dunn Corporation acquired a...Ch. 7 - Prob. 72BPSBCh. 7 - Prob. 73BPSBCh. 7 - Prob. 74BPSBCh. 7 - Prob. 75BPSBCh. 7 - Prob. 76BPSBCh. 7 - Prob. 77.1CCh. 7 - Prob. 77.2CCh. 7 - Prob. 78.1CCh. 7 - Prob. 78.2CCh. 7 - Prob. 79.1CCh. 7 - Prob. 79.2CCh. 7 - Prob. 79.3CCh. 7 - Prob. 80.1CCh. 7 - Prob. 80.2CCh. 7 - Prob. 80.3CCh. 7 - Prob. 80.4CCh. 7 - Prob. 80.5CCh. 7 - Prob. 80.6CCh. 7 - Prob. 80.7CCh. 7 - Prob. 80.8CCh. 7 - Comparative Analysis: Under Armour, Inc., versus...Ch. 7 - Prob. 81.2CCh. 7 - Comparative Analysis: Under Armour, Inc., versus...Ch. 7 - CONTINUING PROBLEM: FRONT ROW ENTERTAINMENT After...Ch. 7 - CONTINUING PROBLEM: FRONT ROW ENTERTAINMENT After...Ch. 7 - CONTINUING PROBLEM: FRONT ROW ENTERTAINMENT After...Ch. 7 - CONTINUING PROBLEM: FRONT ROW ENTERTAINMENT After...
Knowledge Booster
Similar questions
Comparative Analysis: Under Armour, Inc., versus Columbia Sportswear Refer to the 10-K reports of Under Armour, Inc., and Columbia Sportswear that are available for download from the companion website at CengageBrain.com. Required: With regard to depreciation methods: a. What depreciation method does Under Armour use? What depreciation method does Columbia use? b. What are the typical useful lives of each companys operating assets? c. What effect will the useful lives have on the companys financial statements?
arrow_forward
Balance Sheet Presentation The following information relates to the assets of Westfield Semiconductors as of December 31, 2019. Westfield uses the straight-line method for depreciation and amortization. Required: Use the information above to prepare the property, plant, and equipment and intangible assets portions of a classified balance sheet for Westfield.
arrow_forward
Assume that Yousuf & Sons company purchased equipment for OMR 12000 on 31st December 2014. The company charging OMR 2400 depreciation per annum by following straight-line depreciation method. The company charged total depreciation till 31December 2017 is OMR 7200 and the company decided to sell this equipment for OMR 3500 on 31st Mar2018. Find out the profit or loss on sale of equipment and pass the journal entry in the books of Yousuf& Sons Company.
a.
Dr Cash A/C OMR 3500 Dr Accumulated depreciation OMR 7800 Dr Loss on sale of equipment OMR 700 and Equipment A/c OMR 12000
b.
Dr Cash A/C OMR 3500 Dr Accumulated depreciation OMR 7800 and Cr Equipment A/C 11300
c.
None of the given options
d.
Dr Cash OMR 3500 Dr Accumulated depreciation OMR 7200 Dr Loss on sale of Equipment OMR 1300 and Cr Equipment A/C 12000
arrow_forward
Assume that Yousuf & Sons company purchased equipment for OMR 12000 on 31st December 2014. The company charging OMR 2400 depreciation per annum by following straight-line depreciation method. The company charged total depreciation till 31December 2017 is OMR 7200 and the company decided to sell this equipment for OMR 3500 on 31st Mar2018. Find out the profit or loss on sale of equipment and pass the journal entry in the books of Yousuf& Sons Company.
a.
Dr Cash A/C OMR 3500 Dr Accumulated depreciation OMR 7800 Dr Loss on sale of equipment OMR 700 and Equipment A/c OMR 12000
b.
Dr Cash A/C OMR 3500 Dr Accumulated depreciation OMR 7800 and Cr Equipment A/C 11300
c.
None of the given options
d.
Dr Cash OMR 3500 Dr Accumulated depreciation OMR 7200 Dr Loss on sale of Equipment OMR 1300 and Cr Equipment A/C 12000
Clear my choice
arrow_forward
Required information
Skip to question
[The following information applies to the questions displayed below.]
On April 2, 2017, Victor, Inc. acquired a new piece of filtering equipment. The cost of the equipment was $220,000 with a residual value of $20,000 at the end of its estimated useful lifetime of 10 years.
Assume that in its financial statements, Victor uses straight-line depreciation and the half-year convention. Depreciation recognized on this equipment in 2017 and 2018 will be:
arrow_forward
In this session, we discuss property acquisitions and dispositions. In financial accounting, the acquisition of assets means that specific procedures will be followed, including computing the depreciable cost of the asset and estimating its useful life. These steps are required to compute the depreciation for the acquired asset. The accounting treatment options vary including the use of Straight Line, Units of Production, or an accelerated method such as Declining Balance or Sum of the Years’ digits. (Heintz & Parry, 2017)
If the asset is later sold before being fully depreciated, there may be an accounting gain or loss on disposal, depending on the circumstances. If assets are disposed of under the tax code, such disposal might trigger depreciation recapture.
The deductions allowed under section 1231 allow for tax savings while reducing the taxpayer basis in the asset. Such a reduction in basis might be connected to a realized gain on the disposal of such an asset and allow the…
arrow_forward
Assume that Hider Darwesh Company purchased a Machine for OMR 25000 on 31st December 2013.The company charging OMR 3125 depreciation per annum by following straight-line depreciation method. The company charged total depreciation till 31December 2017 is OMR 12500 and the company decided to sell this equipment for OMR 13000 on 31st Mar2018. Findout the profit or loss on sale of Machine and pass necessary journal entry in the books of Hider Darwesh Company.
a. Dr Cash A/C 13000 Dr accumulated depreciation 13000 and Cr Profit on sale of machinery OMR 1000 Cr Machinery A/C 25000
b. Dr Cash A/C 13000 Dr Accumulated depreciation A/c 13281and Cr Profit on sale of machine 1281 Cr Machinery A/C 25000
c. None of the given options
d. Dr Cash A/C 13000 Dr Accumulated depreciation A/c 13300and Cr Profit on sale of machine 1300 Cr Machinery A/C 25000
arrow_forward
The financial statements of Apple, Inc. are presented in Appendix A of Financial Accounting. Instructions for accessing and using the company's complete annual report, including the notes to the financial statements, are also provided in Appendix A.
the following questions:
What were the total cost and book value of property, plant, and equipment at September 27, 2014?
Using the notes to find financial statements, what method or methods of depreciation are used by Apple for financial reporting purposes?
What was the amount of depreciation and amortization expense for each of the three years 2012-2014? (Hint: Use the statement of cash flows).
Using the statement of cash flows, what are the amounts of property, plant, and equipment purchased in 2014 and 2013?
Using the notes to the financial statements, explain in the summary how Apple accounted for its intangible assets in 2014.
Use the Week 2 Excel® spreadsheet to show your work.
Go to http://investor.apple.com.
Select the Financial…
arrow_forward
how How can due entries?
Intangibles: Balance Sheet Presentation and Income Statement Effects
Bringle Company has provided information on intangible assets as follows:
A patent was purchased from Lou Company for $1,845,000 on January 1, 2018. Bringle estimated the remaining useful life of the patent to be 15 years. The patent was carried in Lou's accounting records at a net book value of $1,635,000 when Lou sold it to Bringle.
During 2019, a franchise was purchased from Rink Company for $470,000. In addition, 6% of revenue from the franchise must be paid to Rink. Revenue from the franchise for 2019 was $2,000,000. Bringle estimates the useful life of the franchise to be 5 years and takes a full year's amortization in the year of purchase.
Bringle incurred R&D costs in 2019 as follows:
Materials and equipment
$150,000
Personnel
130,000
Indirect costs
69,000
$349,000
Bringle estimates that these costs will be recouped by December 31, 2020.
On January 1, 2019,…
arrow_forward
QUESTION 1
Mr A is the owner of All Stars General Dealer
ASSET
CATEGORY
COST PRICE
DATE PURCHASED
DEP METHOD
RATE OF DEPRECIATION
Photocopier
Equipment
5000
1 March 2017
Straight line
10%
Machine
Machinery
20000
30 Sept 2018
Diminishing Balance
20%
Hilux Bakkie
Vehicle
200000
1 December 2019
Diminishing Balance
25%
Furniture
Furniture
80000
1 July 2016
Straight line
33.33%
The depreciation for all fixed assets for the year ending 31 March 2021
Journalise the depreciation at 31 March 2021
Draw up and balance the following ledger accounts as at 31 March 2021:
Equipment
Vehicles
Furniture
Calculate the carrying value of all assets as at 31 March 2021
Required:
Below is the asset register of All Stars General Dealer
arrow_forward
Journalizing partial-year depreciation and asset disposals and exchanges
During 2018, Lora Company completed the following transactions:
Record the transactions in the journal of Lora Company.
arrow_forward
Required information
Skip to question
[The following information applies to the questions displayed below.]
On April 2, 2017, Victor, Inc. acquired a new piece of filtering equipment. The cost of the equipment was $220,000 with a residual value of $20,000 at the end of its estimated useful lifetime of 10 years.
Assume that in its financial statements, Victor uses straight-line depreciation and rounds depreciation for fractional years to the nearest whole month. Depreciation recognized on this equipment in 2017 and 2018 will be:
arrow_forward
arrow_back_ios
arrow_forward_ios
Recommended textbooks for you
Cornerstones of Financial Accounting
Accounting
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Cengage Learning
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:Cengage Learning
Financial Accounting: The Impact on Decision Make...
Accounting
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Cengage Learning
Cornerstones of Financial Accounting
Accounting
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Cengage Learning
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:Cengage Learning
Financial Accounting: The Impact on Decision Make...
Accounting
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Cengage Learning