A company purchased factory equipment on June 1, 2017, for $160,000. It is estimated that the equipment will have a $10,000 salvage value at the end of its 10-year useful life. Using the straight-line method of depreciation, the amount to be recorded as depreciation expense at December 31, 2017, is Select one: a. $8,750. b. $6,250. c. $15,000. d. $7,500.
A company purchased factory equipment on June 1, 2017, for $160,000. It is estimated that the equipment will have a $10,000 salvage value at the end of its 10-year useful life. Using the straight-line method of depreciation, the amount to be recorded as depreciation expense at December 31, 2017, is Select one: a. $8,750. b. $6,250. c. $15,000. d. $7,500.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
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A company purchased factory equipment on June 1, 2017, for $160,000. It is estimated that the equipment will have a $10,000 salvage value at the end of its 10-year useful life. Using the straight-line method of depreciation , the amount to be recorded as depreciation expense at December 31, 2017, is
Select one:
a. $8,750.
b. $6,250.
c. $15,000.
d. $7,500.
If the month-end bank statement shows a balance of $75,000, outstanding checks are $54,000, a deposit of $15,000 was in transit at month end, and a check for $4,000 was erroneously charged by the bank against the account, the correct balance in the bank account at month end is
Select one:
a. $75,000.
b. $118,000.
c. $40,000.
d. $37,000.
Internal controls are concerned with
Select one:
1. only manual systems of accounting
2.
safeguarding assets.
3. preparing income tax returns
4. the extent of government regulations.
Using the percentage-of-receivables basis, the uncollectible accounts for the year is estimated to be $33,000. If the balance for the Allowance for Doubtful Accounts is a $5,000 credit before adjustment, what is the amount of bad debt expense for the period?
Select one:
a. $33,000
b. $38,000
c. $28,000
d. $5,000
The entry to replenish a petty cash fund includes a credit to
Select one:
A. Cash.
B. Freight-in.
C. Petty Cash.
D. Postage Expense.
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