A machine was on purchased on September 30th for $500,000 with a residual value of $45,000. The company estimates that the machine will last 7 years and produce 2,000,000 parts over its life. Calculate depreciation expense using the Straight-Line method for the 7-year life. (NOTE: Round your answers to the nearest dollar and enter it enter it WITHOUT decimals, commas or dollar signs [Example 75000].) 1. Year 1 - $ 2. Year 2 - __$ 3. Year 3-$ 4. Year 4 -__$ 5. Year 5- __$ 6. Year 6 -__$ 7. Year 7 - __$ 8. Year 8 -__$

A machine was on purchased on September 30th for $500,000 with a residual value of $45,000. The company estimates that the machine will last 7 years and produce 2,000,000 parts over its life. Calculate depreciation expense using the Straight-Line method for the 7-year life. (NOTE: Round your answers to the nearest dollar and enter it enter it WITHOUT decimals, commas or dollar signs [Example 75000].) 1. Year 1 - $ 2. Year 2 - $ 3. Year 3-$ 4. Year 4 -$ 5. Year 5- $ 6. Year 6 -$ 7. Year 7 - $ 8. Year 8 -$

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Description: A machine was on purchased on September 30th for $500,000 with aresidual value of $45,000. The company estimates that the machine willlast 7 years and produce 2,000,000 parts over its life.Calculate depreciation expense using the Straight-Line metho

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 8PA: Referring to PA7 where Kenzie Company purchased a 3-D printer for $450,000, consider how the...

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Referring to PA7 where Kenzie Company purchased a 3-D printer for $450,000, consider how the purchase of the printer impacts not only depreciation expense each year but also the assets book value. What amount will be recorded as depreciation expense each year, and what will the book value be at the end of each year after depreciation is recorded?
For each of the following unrelated situations, calculate the annual amortization expense and prepare a journal entry to record the expense: A. A patent with a seventeen-year remaining legal life was purchased for $850,000. The patent will be usable for another six years. B. A patent was acquired on a new tablet. The cost of the patent itself was only $12,000, but the market value of the patent is $150,000. The company expects to be able to use this patent for all twenty years of its life.
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.
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 ten years. Montello uses the straight-line depreciation method. Calculate the annual depreciation expense.
A machine was on purchased on March 2nd for $500,000 with a residual value of $50,000. The company estimates that the machine will last 5 years and produce 2,000,000 parts over its life. Calculate depreciation expense using the Straight-Line method for the 5-year life. (NOTE: Round your answers to the nearest dollar and enter it enter it WITHOUT decimals, commas or dollar signs [Example 75000].) 1. Year 1 - $ 2. Year 2 -___$ 3. Year 3 - $ 4. Year 4 - $ 5. Year 5 - $ 6. Year 6 - $
A machine can be purchased for $130,000 and used for five years, yielding the following income. This income computation includes annual depreciation expense of $26,000. Income Year 1 $8,800 Year 2 $21,800 Year 3 $57,000 Year 4 $32,900 Year 5 $87,200 Compute the machine's payback period. (Round payback period answer to 2 decimal places.) × Answer is complete but not entirely correct. Year Net Income Depreciation Net Cash Flow Cumulative Net Cash Flow Initial invest $ (130,000) $ (130,000) Year 1 $ 8,800 $ 26,000 34,800 34,800 x Year 2 21,800 26,000 47,800 82,600 x Year 3 57,000 26,000 83,000 130,000 × Year 4 32,900 26,000 Year 5 87,200 26,000 Payback period = 2.57 years
A machine can be purchased for $50,000 and used for five years, yielding the following income. This income computation includes annual depreciation expense of $10,000. Income Year Year 1 $3,300 Initial invest Year 1 Year 2 Year 3 Year 4 Year 5 Year 2 $8,300 Compute the machine's payback period. Note: Round payback period answer to 2 decimal places. Net Income Depreciation 3,300 8,300 30,000 12,400 33,200 Year 3 $30,000 Year 4 $12,400 Net Cash Flow $ (50,000) $ Payback period = Year 5 $33,200 Cumulative Net Cash Flow (50,000) 0 0
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On June 30, 2018, Clooney Printers purchased a printer for $59,000. It expects the printer to last for four years and have a residual value of $9,000. Compute the depreciation expense on the printer for the year ended December 31, 2018, using the straight – line method. (Round any intermediate calculations to two decimal places, and your final answer to the nearest dollar.) A. $12,500 O B. $14,750 C. $7,292 D. $6,250 n Tools
Your company is considering the purchase of a machine at a cost of P1,261,652, with an estimated salvage value of P207,760 and a projected useful life of 16 years. Determine the depreciation on the 5th year using the sum of years digits (SOYD) depreciation method. Write your final answer in two decimal places.
Please answer items 13, 14, 15 and 16. Thank you.
A machine can be purchased for $90,000 and used for five years, yielding the following income. This income computation includes annual depreciation expense of $18,000 Income Year 1 Year 3 Year 5. $6,000 $36,000 $60,000 Compute the machine's payback period. (Round payback period answer to 2 decimal places.) Year Initial invest - Year 1 Year 2 Year 3 Year 4 Year 5 Net Income Depreciation $ Year 2 $15,000 6,000 15,000 36,000 22,500 60,000 Year 4 $22,500 Net Cash Flow $ Cumulative Net Cash Flow (90,000) $ Payback period- (90,000)