Gleason purchased a used van for use in its business on January 1, 2020. It paid $9,000 for the van. Gleason expects the van to have a useful life of four years, with an estimated residual value of $600. Gleason expects to drive the van 15,000 miles during 2020, 30,000 miles during 2021, 10,000 miles in 2022, and 15,000 miles in 2023, for total expected miles of 70,000. Read the requirements. (Complete all input fields. Enter a "0" for any zero values.) Year Start 2020 2021 2022 2023 Double-declining-balance method Annual Depreciation Accumulated Expense Depreciation Book Value

Gleason purchased a used van for use in its business on January 1, 2020. It paid $9,000 for the van. Gleason expects the van to have a useful life of four years, with an estimated residual value of $600. Gleason expects to drive the van 15,000 miles during 2020, 30,000 miles during 2021, 10,000 miles in 2022, and 15,000 miles in 2023, for total expected miles of 70,000. Read the requirements. (Complete all input fields. Enter a "0" for any zero values.) Year Start 2020 2021 2022 2023 Double-declining-balance method Annual Depreciation Accumulated Expense Depreciation Book Value

Name: Gleason purchased a used van for use in its business on January 1, 20
Uploaded: 2024-03-05T11:50:36.000Z
Channel: Bartleby
Description: Gleason purchased a used van for use in its business on January 1, 2020. It paid $9,000 for the van. Gleason expects the van to have a useful life of four years, with an estimated residual value of$600. Gleason expects to drive the van 15,000 miles

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Mama's Frid Chicken bought equipment on January 2, 2018, for $30,000. The equipment was expected to remain in service for four years and to operate for 4,8000 hours. At the end of the equipment's useful life, Mama's estimates that its residual value will be $6,000. The equipment operated for 480 hours the first year, 1,440 hours the second year, 1,920 hours the third year, and 960 hours the fourth year. Prepare a schedule of depreciation expense, accumulated depreciation, and book value per year for the equipment under the three depreciation methods: straight-line, units-of-production, and double-declining-balance. Show your computations. Note: Three depreciation schedules must be prepared. Which method tracks the wear and tear on the equipment most closely?
Speed, Inc., is a shipping company. On 1/1/20, the company purchases a new commercial sleeper truck for $790,000 cash. The expected residual value of the truck is $60,000 and the expected useful life is 10 years. The company estimates that the truck will be used to drive 1,000,000 miles over its useful life (120,000 miles in 2020; 90,000 miles in 2021 & all subsquent years). For the units-of-activity method, round the depreciaiton-per-unit to two decimal places before using it. You PART A - STRAIGHT LINE DEPRECIATION Income StatementDepreciation Expense Year Ended 12/31/2020fill in the blank 1 Year Ended 12/31/2021 fill in the blank 2 Balance SheetAccumulated Depreciation As of 12/31/2020fill in the blank 3 As of 12/31/2021fill in the blank 4 PART B - UNITS-OF-ACTIVITY DEPRECIATION Income StatementDepreciation Expense Year Ended 12/31/2020fill in the blank 5 Year Ended 12/31/2021 fill in the blank 6 Balance SheetAccumulated Depreciation As of 12/31/2020fill in the…
At the beginning of 2020, your company buys a $30,400 piece of equipment that it expects to use for 4 years. The equipment has an estimated residual value of 6,000. The company expects to produce a total of 200,000 units. Actual production is as follows: 47,000 units in 2020, 50,000 units in 2021, 52,000 units in 2022, and 51,000 units in 2023.Required: Determine the depreciable cost. Calculate the depreciation expense per year under the straight-line method. Use the straight-line method to prepare a depreciation schedule. Calculate the depreciation rate per unit under the units-of-production method. Use the units-of-production method to prepare a depreciation schedule.
Beats Corporation constructed a machine at a total cost of $206 million. Construction was completed at the end of 2020 and the machine was placed in service at the beginning of 2021. The machine was being depreciated over a 10-year life using the sum - of-the- yearsdigits method. By that method, accumulated depreciation at the end of 2023 is $972 milion. The residual value is expected to be $8.0 million. At the beginning of 2024, Beats decided to change to the straight-line method. Ignoring income taxes, what will be Beats's depreciation expense for 2024? Do not round intermedlate calculations. $14.4 million $27.2 million $5.4 million $16.2 million
New Style Corporation is a company that manufactures and sells chairs. On 1/1/20, the company purchases a piece of manufacturing equipment for $3,100,000 cash. The expected residual value is $200,000 and the useful life is 5 years. The company expects to produce 5,000,000 chairs with the equipment – 1,200,000 chairs in 2020; 1,400,000 chairs in 2021; 1,000,000 chairs in 2022; and 600,000 chairs 2023; and 800,000 chairs in 2024. Show your work. Round per unit to the nearest cent. Assume that New Style Corporation uses the Straight-Line method of depreciation.
8. On January 1, 2019, Sapphire Manufacturing Company purchased a machine for $40,000,000. The company expects to use the machine for 24,000 hours over the next six years. The estimated residual value of the machine at the end of the sixth year is $40,000. The schedule of usage of the machine is below. Year Usage 1 4,500 2 6,000 3 5,200 4 4,300 5 2,000 6 2,000 Prepare the depreciation schedule using the units-of-production method of depreciation.
A machine that produces cellphone components is purchased on January 1, 2024, for $171,000. It is expected to have a useful life of four years and a residual value of $12,000. The machine is expected to produce a total of 200,000 components during its life, distributed as follows: 40,000 in 2024, 50,000 in 2025, 60,000 in 2026, and 50,000 in 2027. The company has a December 31 year end. (a) Calculate the amount of depreciation to be charged each year, using each of the following methods: i. Straight-line method Straight-line method depreciation Senter a dollar amount per year per year ii. Units-of-production method (Round depreciation per unit to 3 decimal places, e.g. 15.257 and depreciation expense to 0 decimal places, e.g. 125.) Units-of-production method depreciation Senter a dollar amount per unit rounded to 3 decimal places per unit Year Depreciation Expense 2024 Senter a dollar amount 2025 Senter a dollar amount 2026 Senter a dollar amount 2027 Senter a dollar amount iii.…
This company purchased new excavating equipment at the beginning of 2021. The equipment has a cost of $37,000, an estimated life of 5 years, and an estimated residual value of $7,000. A full year's depreciation expense is to be recorded in 2021. The equipment was used for 20,000 hours during 2021 and 24,000 hours during 2022. The number of expected hours over 5 years is 100,000. The company is comparing the straight-line and double-declining-balance depreciation methods. Of these two methods, which method creates the larger expense and which method creates the larger tax savings in 2021? a. Straight-line depreciation creates the larger expense, while double-declining-balance depreciation creates the larger tax savings. b. Double-declining-balance depreciation creates both the larger expense and the larger tax savings. c. Double-declining-balance depreciation creates the larger expense, while straight-line depreciation creates the larger tax savings. d. Straight-line depreciation…
In August 2020, Heavy-lift Helicopters Ltd. purchased a new helicopter for its logging and heavy lift operations at a cost of $1.056 million. Based on past experience, management has determined that the helicopter will have a useful life of 13,000 flying hours, at which time it will have an estimated residual value of $250,000. During 2020, the helicopter was used for 1,300 flying hours, and in 2021 it was used for 1,600 flying hours. Heavy-lift Helicopters has a December 31 year end and uses the units-of-production method of depreciation for its helicopters. Determine the depreciation expense on this helicopter for 2021 and its carrying amount at December 31, 2021. 2021 Depreciation expense %24 Carrying amount 24 eTextbook and Media Save for Later
The cost of equipment purchased by Concord, Inc., on April 1, 2020, is $127,00O. It is estimated that the machine will have a $7,000 salvage value at the end of its service life. Its service life is estimated at 6 years; its total working hours are estimated at 40,000; and its total production is estimated at 480,000 units. During 2020, the machine was operated 3,500 hours and produced 48,000 units. During 2021, the machine was operated 5,600 hours and produced 55,000 units. Compute depreciation expense on the machine for the year ending December 31, 2020, and the year ending December 31, 2021, using the following methods. (Round depreciation per unit to 2 decimal places, e.g. 15.25 and final answers to 0 decimal places, e.g. 45,892.) 2020 2021 (a) Straight-line 2$ 24 (b) Units-of-output %24 24 (c) Working hours 24 (d) Sum-of-the-years'-digits 24 (e) Double-declining-balance (twice the straight-line rate) 24 2$ %24 %24
Bramble Corp. purchased Machine no. 201 on May 1, 2020. The following information relating to Machine no. 201 was gathered at the end of May: Price Credit terms Freight-in costs Preparation and installation costs Labour costs during regular production operations $72,000 2/10, n/30 $700 $3,200 $9,000 It was expected that the machine could be used for 10 years, after which the residual value would be zero. However, Bramble intends to use the machine for only eight years and expects to then be able to sell it for $1,500. The invoice for Machine no. 201 was paid on May 5, 2020. Bramble has a December 31 year end. Depreciation expense should be calculated to the nearest half month. Bramble follows IFRS for financial statement purposes. Calculate the depreciation expense for the years indicated using the following methods. (Do not round intermediate calculations and round final answers to O decimal places, e.g. 5,275.) 1. Straight-line method for the fiscal years ended December 31, 2020 and…
12.On January 1, 2019, Brazeau Transport purchased a $165,000 truck for hauling cattle across the border. Brazeau plans on driving the truck for four years, or 450,000 kilometres. The expected residual value for the truck is $35,000. On June 30, 2022, after driving the truck 44,000 kilometres, the truck had an accident on the highway and was totalled. The insurance proceeds for the truck were $42,000 cash. Calculate and record the amortization expense for the truck for the year 2019 using the straight-line method.