E9-5 Hinshaw Company purchased a new machine on October 1, 2014, at a cost of $90,000. The company estimated that the machine has a salvage value of $8,000. The machine is expected to be used for 70,000 working hours during its 8-year life. Instructions Compute the depreciation expense under the straight-line method for 2014 and 2015, assuming a December 31 year-end.

E9-5 Hinshaw Company purchased a new machine on October 1, 2014, at a cost of $90,000. The company estimated that the machine has a salvage value of $8,000. The machine is expected to be used for 70,000 working hours during its 8-year life. Instructions Compute the depreciation expense under the straight-line method for 2014 and 2015, assuming a December 31 year-end.

Name: traight-line4on for partial period.E9-5 Hinshaw Company purchased a n
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Description: traight-line4on for partial period.E9-5 Hinshaw Company purchased a new machine on October 1, 2014, at a cost of$90,000. The company estimated that the machine has a salvage value of $8,000. Themachine is expected to be used for 70,000 working hours

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter18: Accounting For Long-term Assets

Section: Chapter Questions

Problem 4CE: Grandorf Company replaced the engine in a truck for 8,000 and expects the new engine will extend the...

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Montello Inc. purchases a delivery truck for $15,000. The truck has a salvage value of $3,000 and is expected to be driven for 120,000 miles. Montello uses the units-of-production depreciation method and in year one it expects to use the truck for 23,000 miles. Calculate the annual depreciation expense.
On January 1, 2014, Klinefelter Company purchased a building for 520,000. The building had an estimated life of 20 years and an estimated residual value of 20,000. The company has been depreciating the building using straight-line depreciation. At the beginning of 2020, the following independent situations occur: a. The company estimates that the building has a remaining life of 10 years (for a total of 16 years). b. The company changes to the sum-of-the-years-digits method. c. The company discovers that it had ignored the estimated residual value in the computation of the annual depreciation each year. Required: For each of the independent situations, prepare all journal entries related to the building for 2020. Ignore income taxes.
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.
On January 1, 2014, ABC Company purchased a machine for P504,000 that was placed in service on March 1, 2014. Additional cost incurred to bring the asset to its location and prepare for its intended use were: shipping, P4,000 and installation and testing cost, P6,000. The estimated useful life of the asset was 10 years and has an estimated salvage value of P34,000. What amount of depreciation should be recognized for the year ended December 31, 2014?
E9-6 Kelm Company purchased a new machine on October 1, 2011, at a cost of $120,000. The company estimated that the machine will have a residual value of $12,000. The machine is expected to be used for 10,000 working hours during its 5-year life. Instructions Compute the depreciation expense under the following methods for the year indicated. (a) Straight-line for 2011. (b) Units-of-activity for 2011, assuming machine usage was 1,700 hours. (c) Declining-balance using double the straight-line rate for 2011 and 2012.
At the beginning of 2009, Glass Manufacturing purchased a new machine for its assembly line at a cost of $600,000. Th e machine has an estimated useful life of 10 years and estimated residual value of $50,000. Under the straight-line method, how much depreciation would Glass take in 2010 for fi nancial reporting purposes? B . $60,000.
At the beginning of 2009, Glass Manufacturing purchased a new machine for its assembly line at a cost of $600,000. Th e machine has an estimated useful life of 10 years and estimated residual value of $50,000. Under the straight-line method, how much depreciation would Glass take in 2010 for fi nancial reporting purposes? A . $55,000.
Xanadu Company purchased a new machine on October 1, 2014, at a cost ofTk.96,000. The company estimated that the machine will have a residual value of Tk.12,000.Themachine is expected to be used for 10,000 working hours during its 5-year life.Requirements:Compute the depreciation expense under the following methods for the year indicated.(a) Straight-line for 2014.(b) Units-of-activity for 2014, assuming machine usage was 1,700 hours.(c) Declining-balance using double the straight-line rate for 2014 and 2015.
E10-6 Rottino Company purchased a new machine on October 1, 2017, at a cost of $150,000. The company estimated that the machine will have a salvage value of $12,000. The machine is expected to be used for 10,000 working hours during its 5-year life. Instructions Compute the depreciation expense under the following methods for the year indicated. (a) Straight-line for 2017. (b) Units-of-activity for 2017, assuming machine usage was 1,700 hours. (c) Declining-balance using double the straight-line rate for 2017 and 2018.
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(Depreciation for Partial Periods—SL, Act., SYD, and DDB) On January 1, 2015, a machine was purchased for $90,000. The machine has an estimated salvage value of $6,000 and an estimated useful life of 5 years. The machine can operate for 100,000 hours before it needs to be replaced. The company closed its books on December 31 and operates the machine as follows: 2015, 20,000 hours; 2016, 25,000 hours; 2017, 15,000 hours; 2018, 30,000 hours; and 2019, 10,000 hours.Instructions(a) Compute the annual depreciation charges over the machine’s life assuming a December 31 year-end for each of the following depreciation methods.(1) Straight-line method. (3) Sum-of-the-years’-digits method.(2) Activity method. (4) Double-declining-balance method.(b) Assume a fiscal year-end of September 30. Compute the annual depreciation charges over the asset’s life applying each of the following methods.(1) Straight-line method. (3) Double-declining-balance method.(2) Sum-of-the-years’-digits method.
Maserati Corporation purchased a new machine for its assembly process on August 1, 2014. The cost of this machine was $150,000. The company estimated that the machine would have a salvage value of $24,000 at the end of its service life. Its life is estimated at 5 years and its working hours are estimated at 21,000 hours. Year- end is December 31. Instructions: Compute the depreciation expense under the following methods. (a) Straight-line depreciation. Sum-of-the-Years'-Digits Method Double-Declining Balance Method