Calculate the annual depreciation to be charged beginning with 2020.Annual depreciation, beginning with 2020%24 In 1991, Bonita Limited completed the construction of a building at a cost of $1.50 million; it occupied the building in January 1992. Itwas estimated that the building would have a useful life of 40 years and a residual value of $300,000.Early in 2002, an addition to the building was constructed at a cost of $550,000. At that time, no changes were expected in its usefullife, but the residual value with the addition was estimated to increase by $100,000. The addition would not be of economic use to thecompany beyond the life of the original building.In 2020, as a result of a thorough review of its depreciation policies, company management determined that the building's originaluseful life should have been estimated at 30 years. The neighbourhood where the building is has been going through a renewal, witholder buildings being torn down and new ones being built. Because of this, it is now expected that the company's building and additionare unlikely to have any residual value at the end of the 30-year period. Bonita Limited follows IFRS for its financial statements.

Answered: In 1991, Bonita Limited completed the…

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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In 1998, Novak Company completed the construction of a building at a cost of $2,500,000 and first occupied it in January 1999. It was estimated that the building will have a useful life of 40 years and a salvage value of $76,000 at the end of that time. Early in 2009, an addition to the building was constructed at a cost of $625,000. At that time, it was estimated that the remaining life of the building would be, as originally estimated, an additional 30 years, and that the addition would have a life of 30 years and a salvage value of $25,000. In 2027, it is determined that the probable life of the building and addition will extend to the end of 2058, or 20 years beyond the original estimate. (a) Using the straight-line method, compute the annual depreciation that would have been charged from 1999 through 2008. Annual depreciation from 1999 through 2008 $ GA /yr.
Broadway Limited (“Broadway”) purchased a piece of equipment on 1 February 2022 and had it fully set-up and operational on that date. The equipment was purchased for $160,000. In addition to the purchase price, Braodway spent $20,000 to transport the equipment on site and $30,000 of engineering fees to set-up the equipment. It had an estimated useful life of 10 years and an estimated residual value of $30,000. Each year $3,000 is spent on repairs and maintenance. On 1 July 2024, the equipment was sold for $82,500 cash. Broadway’s financial year end balance date is 30 June (ignore GST). Record the general journal entry to record the depreciation expense for the equipment for the year ending 30 June 2022 if Broadway uses the straight-line depreciation method.
In 1993, Concord Company completed the construction of a building at a cost of $ 2,100,000 and first occupied it in January 1994. It was estimated that the building will have a useful life of 40 years and a salvage value of $ 63,200 at the end of that time. Early in 2004, an addition to the building was constructed at a cost of $ 525,000. At that time, it was estimated that the remaining life of the building would be, as originally estimated, an additional 30 years, and that the addition would have a life of 30 years and a salvage value of $ 21,000. In 2022, it is determined that the probable life of the building and addition will extend to the end of 2053, or 20 years beyond the original estimate.
Broadway Limited (“Broadway”) purchased a piece of equipment on 1 February 2022 and had it fully set-up and operational on that date. The equipment was purchased for $160,000. In addition to the purchase price, Braodway spent $20,000 to transport the equipment on site and $30,000 of engineering fees to set-up the equipment. It had an estimated useful life of 10 years and an estimated residual value of $30,000. Each year $3,000 is spent on repairs and maintenance. On 1 July 2024, the equipment was sold for $82,500 cash. Broadway’s financial year end balance date is 30 June (ignore GST). Record the general journal entry required for the disposal of the equipment on 1 July 2024 if Broadway uses the diminishing-balance depreciation method at a rate of 30%.
Compute the annual depreciation to be charged, beginning with 2022. (Round answer to O decimal places, e.g. 45,892.) Annual depreciation expense-building %24
A machine purchased by the Bee Buzzsaw Company originally cost $245,000. Delivery and installation charges amounted to $5000. The declared salvage value was $25,000; useful life of the machine was 12 years. At the end of Year 4, the company changed its product mix and found that it no longer needed the machine. One of its competitors agreed to buy the machine for $90,000. Compute the book value of the machine at end of Year 4 and determine the loss or gain of depreciation on the sale using: a. Straight-Line Methodb. Sinking fund at 8%c. Double Declining Balance Methodd. Sum-of-the-Years-Digits Method
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This is the last one I need to answer.
In 1990, Sheridan Company completed the construction of a building at a cost of $860,000 and fırst occupied it in January 1991. It was estimated that the building would have a useful life of 40 years and a salvage value of $26,000 at the end of that time. Early in 2001, an addition to the building was constructed at a cost of $215,000. At that time, it was estimated that the remaining life of the building would be, as originally estimated, an additional 30 years, and that the addition would have a life of 30 years and a salvage value of $9,000. In 2019, it is determined that the probable life of the building and addition will extend to the end of 2050, or 20 years beyond the original estimate. (a) Using the straight-line method, compute the annual depreciation that would have been charged each year from 1991 through 2000. Annual depreciation from 1991 through 2000 $ / yr %24
In August 2024, Carla Vista Helicopters Ltd. purchased a new helicopter for its logging and heavy lift operations at a cost of $1.05 million. Based on past experience, management has determined that the helicopter will have a useful life of 18,000 flying hours, at which time it will have an estimated residual value of $150,000. During 2024, the helicopter was used for 1,800 flying hours, and in 2025 it was used for 2,000 flying hours. Carla Vista 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 2025 and its carrying amount at December 31, 2025. Depreciation expense $ Carrying amount $ 2025
Coronado Manufacturing purchased a machine on January 1, 2023 for use in its factory. Coronado paid $512,000 for the machine and estimated that it had a useful life of 10 years, at the end of which time the machine was expected to have a residual value of $50,000. During its life, the machine was expected to produce 280,000 units. During 2023, the machine produced 31,500 units, and produced 42,600 in 2024. The machine was subject to a 20% CCA rate, and Coronado's year-end was December 31. The machine is eligible for the Accelerated Investment Incentive.
In 1990, Sunland Company completed the construction of a building at a cost of $880,000 and first occupied it in January 1991. It was estimated that the building would have a useful life of 40 years and a salvage value of $26,000 at the end of that time. Early in 2001, an addition to the building was constructed at a cost of $220,000. At that time, it was estimated that the remaining life of the building would be, as originally estimated, an additional 30 years, and that the addition would have a life of 30 years and a salvage value of $9,000. In 2019, it is determined that the probable life of the building and addition will extend to the end of 2050, or 20 years beyond the original estimate. Using the straight-line method, compute the annual depreciation that would have been charged each year from 1991 through 2000. Annual depreciation from 1991 through 2000 Compute the annual depreciation that would have been charged from 2001 through 2018. Annual depreciation from…

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