Jeter Company purchased a new machine on May 1, 1998 for $176,000. At thetime of acquisition, the machine was estimated to have a useful life of ten yearsand an estimated salvage value of $8,000. The company has recorded monthlydepreciation using the straight-line method. On March 1, 2007, the machinewas sold for $24,000. What should be the loss recognized from the sale of themachine?$-0-O $3,600$8,000$11,600

First, we need to calculate the total depreciation of the machine over its useful life. The formula…

Answered: Jeter Company purchased a new machine…

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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Popeye Company purchased a machine for $350,000 on January 1, 2020. Popeye depreciates machines of this type by the straight-line method over a five-year period using no salvage value. Due to an error, no depreciation was taken on this machine in 2020. Popeye discovered the error in 2021. What amount should Popeye record as depreciation expense for 2021? The tax rate is 25%. O O O O $105,000. $52,500. $70,000. $140,000.
In recent years, Flakeboard Company purchased three machines. Various amortization methods were selected. Information concerning the machines is summarized below: Machine Acquired Jan. 1, 1999 Jan. 1, 2000 Nov. 1, 2001 1 2 3 Cost Residual Useful Life in Amortization Method Value $6,000 10,000 6,000 $96,000 60,000 66,000 Years 10 8 6 Straight-line Declining-balance Units-of-activity For the declining-balance method, the company uses double the straight-line rate. For the units-of- activity method, total machine hours are expected to be 24,000. Actual hours of use in the first two years were 1,000 in 2001 and 4,500 in 2002. Instructions a) Calculate the amount of accumulated amortization on each machine at December 31, 2002. Round your answers to the nearest dollar. b) If Machine 2 has been purchased on April 1 instead of January 1, what would the amortization expense be for the machine in 1) 2000, 2) 2001, and 3) 2002?
Jason Co purchased a machinery for £100,000 on 1/1/2018. It had an estimated useful life of ten years and it was depreciated using the reducing balance method at a rate of 20%. On 1/1/20 it was decided to change the depreciation method to the straight line. There was no change to the useful life, and no residual value is anticipated. What are the accumulated depreciation and the net book value of the asset for the year ended 31 December 2021?
The Giovanni Company purchased a tooling machine in 2007 for $120,000. The machine was being depreciated by the straight-line method over an estimated useful life of 20 years, with no salvage value. At the beginning of 2017, after 10 years of use, Giovanni paid $20,000 to overhaul the machine. Because of this improvement, the machine's estimated useful life would be extended an additional 5 years. What would be the depreciation expense recorded for the above machine in 2017? a.$7,333 b.$4,000 c.$6,000 d.$5,333
Urmilaben
On January 1, 2016, Rexford Company purchased a drilling machine for $11,500. The machines has an estimated useful life of 4 years and a salvage value of $200. Given this information, if Rexford uses double-declining-balance method of depreciation, and sells the machine on December 31, 2017, for $3,000 cash. Then how much will be gain or loss on disposal of this asset? $ 2,750 loss $ 1,800 loss $1,562 gain $ 125 gain
Lugar Company purchased a piece of machinery for $28,500 on January 1, 2016, and has been depreciating the machine using the sum-of-the-years'-digits method based on a five-year estimated useful life and no salvage value. On January 1, 2018, Lugar decided to switch to the straight-line method of depreciation. The salvage value is still zero and the estimated useful life is changed to a total of six years from the date of purchase. Ignore income taxes. Required:1. Prepare the appropriate journal entry, if any, to record the accounting change under GAAP.2. Prepare the journal entry to record depreciation for 2018.
Luna Springs Inc. exchanged an old vehicle for a new vehicle on August 31, 2014. The original cost of Luna Springs Inc.'s old vehicle was $45,000 on January 1, 2010. Depreciation was calculated using the straight line method over a ten-year useful life, with an estimated residual value of $3,000. The fair value of the old vehicle on August 31, 2014 was $21,500. The list price of the new vehicle was $30,000. Luna Springs Inc. paid $2,000 in cash as part of the exchange. The new vehicle should be recorded on Luna Springs Inc.'s books at: $25400, $23500, $30000, or none of the above
On July 1, 2021, Hale Kennels sells equipment for $222000. The equipment originally cost $594000, had an estimated 5-year life and an expected salvage value of $109000. The accumulated depreciation account had a balance of $342000 on January 1, 2021, using the straight-line method. The gain or loss on disposal is $18500 loss. $30000 loss. $18500 gain. $30000 gain
On December 31, 2020, Listach Inc. sold a used industrial crane for $600,000 cash. The original cost of the crane was $5.0 million and its accumulated depreciation equaled $4.2 million on December 31, 2020. What is the gain or loss from the December 31, 2020 equipment sale? Group of answer choices A)$800,000 gain B)$800,000 loss C)$200,000 loss D)$200,000 gain E)None of the above

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