K-Granny's Fried Chicken bought equipment on January 2, 2024, for $21,000. The equipment was expected to remain in service for four years and to operate for 3,600 hoursAt the end of the equipment's useful life, Granny's estimates that its residual value will be $3,000. The equipment operated for 360 hours the first year, 1,000 hours thesecond year, 1,440 hours the third year, and 720 hours the fourth yearRead the requirementsAssetDateCost1-2-2024 S 21,00012-31-202412-31-202512-31-202612-31-2027DepreciableCost$18,00010.000.18.00018,000UsefulLife4 years4 years4 years4 yearsMResidual valueDepreciation AccumulatedExpenseDepreciationS4,500 $4,5004.5004,5004,5009,000Useful life in units13,50018.000HookValueBefore calculating the units of production depreciation schedule, calculate the depreciation expense per unit. Select the formula, then enter the amounts and calculate thedepreciation expense per unitCost$ 21,00016,50012.0007,5003,000Depreciation per unit14O

Depreciation Expenses is an expense incurred on the fixed assets of the company. Depreciation is…

Granny's Fried Chicken bought equipment on January 2, 2024, for $21.000 The equipment was expected to remain in service for four years and to operate for 3,600 hours At the end of the equipment's useful life, Granny's estimates that its residual value will be $3.000. The equipment operated for 360 hours the first year, 1,000 hours the second year, 1,440 hours the third year, and 720 hours the fourth year Read the requirements Asset Date Cost 1-2-2024 S 21,000 12-31-2024 12-31-2025 12-31-2026 12-31-2027 Depreciable Cost S 18.000- 10.000 10.000 18,000 Useful Life 4 years 4 years 4 years 4 years Depreciation Accumulated Expense Depreciation Residual value 5 4,500 $ 4.500 4.500 4,500 4.500 9,000 13,500 10.000 Useful Me in units Book Value Before calculating the units of production depreciation schedule, calculate the depreciation expense per unit Select the formula then enter the amounts and calculate the depreciation expense per unit Cost $ 21.000 16,500 12.000 7.500 3,000 Depreciation per un

Granny's Fried Chicken bought equipment on January 2, 2024, for $21.000 The equipment was expected to remain in service for four years and to operate for 3,600 hours At the end of the equipment's useful life, Granny's estimates that its residual value will be $3.000. The equipment operated for 360 hours the first year, 1,000 hours the second year, 1,440 hours the third year, and 720 hours the fourth year Read the requirements Asset Date Cost 1-2-2024 S 21,000 12-31-2024 12-31-2025 12-31-2026 12-31-2027 Depreciable Cost S 18.000- 10.000 10.000 18,000 Useful Life 4 years 4 years 4 years 4 years Depreciation Accumulated Expense Depreciation Residual value 5 4,500 $ 4.500 4.500 4,500 4.500 9,000 13,500 10.000 Useful Me in units Book Value Before calculating the units of production depreciation schedule, calculate the depreciation expense per unit Select the formula then enter the amounts and calculate the depreciation expense per unit Cost $ 21.000 16,500 12.000 7.500 3,000 Depreciation per un

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Granny's Fried Chicken bought equipment on January 2, 2024, for $21,000 The equipment was expected to remain in service for four years and to operate for 3.600 hours. At the end of the equipment's useful life, Granny's estimates that its residual value will be $3,000. The equipment operated for 360 hours the first year, 1,080 hours the second year, 1,440 hours the third year, and 720 hours the fourth year Read the requirements Requirement 1. 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. Begin by preparing a depreciation schedule using the straight-line method Straight Line Depreciation Schedule Date 1-2-2024 12-31-2024 12-31-2025 12-31-2026 12-31-2027 Asset Cost Depreciation for the Year Useful Life Depreciable. Cost Book Depreciation…
Ricky Corporation purchased equipment on January 1, 2016 for $168,803. It isestimated that the equipment will have a $14,000 residual value at the end of its 8-yearuseful life. It is also estimated that the equipment will produce 110,000 units over its 8-year life. Round the rate per unit to two decimals.On December 31, 2018, Ricky sells the equipment for $85,000.Ricky produced 20,000 units in 2016, 24,000 units in 2017 and 22,000 units in 2018. Instructions(a) Determine the carrying amount of the equipment at December 31, 2018using the units-of-production method of depreciation.(b) Prepare the appropriate journal entry for the sale of the equipment.
Mabini Company closes its books every December 31. On August 1, 2018, they bought a machine for P300,000. The machine is expected to have a useful life of 10 years with no scrap value. On August 1, 2022, P36,000 was paid for the major overhaul of the machine which extended the life of the machine for another two years. The machine was sold for P185,000 on June 30, 2023. The depreciation expense of the machine for 2022 was: a. 28,750b. 30,000c. 27,000d. none of these
On January 1, 2017, Northeast USA Transportation Company purchased a used aircraft at a cost of $52,300,000. Northeast USA expects the plane to remain useful for five years (7,300,000 miles) and to have a residual value of $4,300,000. Northeast USA expects to fly the plane 875,000 miles the first year, 1,350,000 miles each year during the second, third, and fourth years, and 2,375,000 miles the last year. Read the requirements. 1. Compute Northeast USA's depreciation for the first two years on the plane using the straight-line method, the units-of-production method, and the double-declining balance method. a. Straight-line method Using the straight-line method, depreciation is $ for 2017 and $ for 2018.
On January 1, 2022, Myron made $100,000 worth of extraordinary repairs on this equipment. It financed these repairs by taking out a two-year, 12% note. These repairs are expected to extend the useful life of the equipment by an additional three (3) years past its original five (5) year life (to a new total life of 8 years). There is no change expected to the asset’s residual value. Myron uses the straight-line depreciation method for all its depreciable assets. Description Information Purchase Date January 1, 2020 Original capitalized cost $800,000 Original useful life 5 years Original residual value $40,000 How much depreciation expense should be recorded on the equipment for the year ending 12/31/22? Round to the nearest whole dollar.
10. On January 1, 2021, Homestead Designs purchased some equipment for $19,600. The anticipated life of the equipment was five years and residual value was estimated to be $3,100. The machine was expected to produce 600,000 units. In January, 25,000 units were produced and production was doubled in February. The company uses the activity depreciation method. What is the amount of depreciation expense for the month of February? a. $637.50 b. $1,210.00 c. $2,354.00 d. $1,375.00
De La Salle University buys a steam generator for P250,000. The shipping and installation fees amount to P25,850. The manufacturer indicates that the life span of the system is 20 years. The system can sell at P10,000 at the end of its life. Determine the depreciation charge during the 12th year, and thebook value at the end of 14 years by the (a) Declining balance method, (b) DDB method, (c) sinking fund method given interest rate at 12.5 percent, and (d) Sum-of-the-Years Digit (SYD) Method.
1. On April 22, 2023, Sunlight Enterprises purchased equipment for $134,400. The company expects to use the equipment for 11,500 working hours during its four-year life and that it will have a residual value of $12,500. Sunlight has a December 31 year end and pro-rates depreciation to the nearest month. The actual machine usage was: 1,700 hours in 2023; 2,600 hours in 2024; 3,500 hours in 2025; 3,000 hours in 2026; and 900 hours in 2027. Please explain & show steps for each. a) Complete a depreciation schedule for the life of the asset under each of the following methods: (straight-line,double diminishing-balance assuming a rate of 50%, and units-of-production.) b) Which method results in the lowest profit over the life of the asset? c) Which method results in the least cash used for depreciation over the life of the asset? Calculate partial-year depreciation using different methods.
On January 2, 2025, Ivanhoe Co. bought a trademark from Rice, Inc. for $1641000. An independent research company estimated that the remaining useful life of the trademark was 10 years. Its unamortized cost on Rice's books was $1969200. Ivanhoe expects that the trademark will produce 25% of its cash flows in year 1, 20% in year 2, 15% in year 3, and 10% in the remaining years. In Ivanhoe's 2025 income statement, what amount should be reported as amortization expense? Select answer from the options below - $410250 $318200 $273500 $164100
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Parker, Inc purchased new equipment for $57,400. The new equipment would save on operating costs over the next 5 years as follows: $22,500 in year 1; $22,200 in year 2; $23,200 in year 3; $12,600 in year 4; and $11,000 in year 5. The payback period for the new equipment is ______ years
Cargill purchased equipment for $96,000 on January 1, 2024. The equipment is expected to have a five-year life and a residual value of $4,500. Cargill uses the straight-line method. The book value on December 31, 2024, would be: