ment is depre measured at
Q: Attractions, buildings & equipment, at cost 64,892,000 62,111,000 58,589,000 55,238,000 54,043,000…
A: Total liability = long term liability + current liability Total debt consist of total obligation of…
Q: Discuss the difference between the Rsquared and the adjusted R squared
A: R-squared tells you how well your model explains the variation in your data, while adjusted…
Q: Distinguish between normal and abnormal losses and explain.
A: Definition:Normal Loss: Loss due to the inherent nature of processes and raw materials.Abnormal…
Q: Define Depletion.
A:
Q: On December 31, 2020, the accounting records of the Friends Partnership included the following…
A: Liquidation means where the company decide to close out the operations , sell all the assets and…
Q: 68 Book Value of these assets stands at $17.5 million Required: Assess and calculate the impairment…
A: Impairment loss refers to a permanent decrease in the market value of an asset due to changes in…
Q: Define sacrificing ratio.
A: Definition of Sacrificing Ratio:Sacrificing ratio is the ratio where the old partner give their…
Q: Describe the Cost of Elimination.
A: Costing System - A costing system is created to keep track of the costs incurred as a result of the…
Q: Explain the meaning of the following terms: markup,additional markup, markup cancellation, net…
A: Products are priced at the selling price and used to compare different product lines. The selling…
Q: How to estimate the Residual Value?
A: Residual value means value of fixed asset left after the use of fixed assets. Residual value also…
Q: Define residual value.
A: Depreciation: Depreciation refers to the reduction in the monetary value of a fixed asset due to its…
Q: Calculate the unit quantities of normal and abnormal spoilage.
A: Thus, normal spoilage is 2,570 units.
Q: Solve the attahment.
A: Present value relies on the time value of money concept according to the money worth will change…
Q: What are some examples/scenarios of derecognition?
A: Derecognition means to remove or eliminate a financial asset or liability from the company's Balance…
Q: 1. Compute the residual income of MCC. 2. Compute the EVA of MCC.
A: Calculation of residual income Residual income= Operating income - (Average Operating Asset * Target…
Q: Net sales $52,935 Cost of merchandise sold 36,232 Gross profit on sales
A: Gross Profit = Sales - Cost of goods sold
Q: 1. Beginning merchandise inventory Net purchases $81,367 15,139 Cost of merchandise available for…
A: Cost of merchandise available for sale = Beginning merchandise inventory + Net purchases Beginning…
Q: Define Pretax margin
A: The pretax margin is a ratio to evaluate the operational efficiency of a firm. It measures the…
Step by step
Solved in 2 steps
- Chapman Inc. purchased a piece of equipment in 2018. Chapman depreciated the equipment on a straight-line basis over a useful life of 10 years and used a residual value of $12,000. Chapmans depreciation expense for 2019 was $11,000. What was the original cost of the building? a. $98,000 b. $110,000 c. $122,000 d. $134,000On May 10, 2019, Horan Company purchased equipment for 25,000. The equipment has an estimated service life of 5 years and zero residual value. Assume that the straight-line depreciation method is used. Required: Compute the depreciation expense for 2019 for each of the following four alternatives: 1. Horan computes depreciation expense to the nearest day. (Use 12 months of 30 days each and round the daily depreciation rate to 2 decimal places.) 2. Horan computes depreciation expense to the nearest month. Assets purchased in the first half of the month are considered owned for the whole month. 3. Horan computes depreciation expense to the nearest whole year. Assets purchased in the first half of the year are considered owned for the whole year. 4. Horan records one-half years depreciation expense on all assets purchased during the year.Kam Company purchased a machine on January 2, 2019, for 20,000. The machine had an expected life of 8 years and a residual value of 300. The double-declining-balance method of depreciation is used. Required: 1. Compute the depreciation expense for each year of the assets life and book value at the end of each year. 2. Assuming that the company has a policy of always changing to the straight-line method at the midpoint of the assets life, compute the depreciation expense for each year of the assets life. 3. Assuming that the company always changes to the straight-line method at the beginning of the year when the annual straight-line amount exceeds the double-declining-balance amount, compute the depreciation expense for each year of the assets life.
- ABC Ltd acquired an item of machinery on 1 July 2021 for a cost of $120 000 When the asset was acquired it was considered that the asset would have a useful life to the entity of five years, after which time it would have no residual value It was considered that the pattern of economic benefits would best be reflected by applying the sum-of-digits method Contrary to expectations, on 1 July 2023 the asset was sold for $80 000 Required 1. What was the profit on disposal on 1 July 2023 and what are the journal entries to record the disposal? (Use sum of digit depreciation method) 2. Prepare Depreciation Schedule for the period.Accounting On 30 June 2019, Swan Ltd acquired a machine for $180 000 cash, with an expected useful life of 9 years and a zero residual value. The company has adopted fair value for the valuation of non-current assets. On 30 June 2020, the company hired an independent valuer who assessed the value of the machine to be $175 000 with a remaining useful life of 8 years and residual value of $5 000. On 30 June 2021, the fair value of the machine is $122 000 with a remaining useful life of 6 years and zero residual value. The company uses straight-line depreciation method for depreciating all its property, plant and equipment. Income tax rate is 30%. The financial year ends on 30 June. Required Prepare all the necessary journal entries related to the machine from 30 June 2019 to 30 June 2021.QUESTION 1 Super Ltd acquired a plant for R1 000 000 on 1 January 2020. The plant has a useful life of 4 years and is assessed as having a zero residual value. Depreciation is provided on the straight-line method. Super Ltd has a legal obligation to dismantle the plant at the end of 4 years. • The estimated future costs of dismantling the plant at 31 December 2023 are R40 000. • The present value (at 1 January 2020) of the future dismantling costs is R27 321 (using a discount rate of 10%). The company uses the cost model to account for property, plant and equipment. Required: Prepare the journal entries (ignoring the effects of taxation) relating to the above-mentioned information for 2020 and 2021 assuming that on 1 January 2021: Dismantling costs are expected to increase to R60 000 (PV at 1 January 2021 = R45 079)
- On January 1, 2017, Rabbit Company purchased a machinery for P600,000. The machinery had been depreciated using the straight line method with residual value of P60,000 and useful life of 20 years. On January 1, 2019, the company determined that the remaining useful life is 10 years and the residual value is P80,000. What is the depreciation for 2019? A. 27,000 B. 46,600 C. 54,600 D. 58,250On 1 January 2016 ABC Ltd purchased a machine worth GH¢480,000 with an estimated useful life of 20 years and an estimated zero residual value. Depreciation is on a straight-line basis. The asset had been re-valued on 1 January 2018 to GH¢500,000, but with no change in useful life at that date. On 1 January 2019 an impairment review showed the machine’s recoverable amount to be GH¢200,000 and its remaining useful life to be 10 years. Required Calculate: 1. a. the carrying amount of the machine on 31 December 2017 b. the revaluation surplus arising on 1 January 2018 2. the carrying amount of the machine on 31 December 2017 (immediately before the impairment). 3. a. the impairment loss recognized in the year to 31 December 2019. b. The depreciation charge in the year to 31 December 2019.On 1 January 2016 ABC Ltd purchased a machine worth GH¢480,000 with an estimated useful life of 20 years and an estimated zero residual value. Depreciation is on a straight-line basis. The asset had been re-valued on 1 January 2018 to GH¢500,000, but with no change in useful life at that date. On 1 January 2019 an impairment review showed the machine’s recoverable amount to be GH¢200,000 and its remaining useful life to be 10 years. Required Calculate: a) the carrying amount of the machine on 31 December 2017 b) the revaluation surplus arising on 1 January 2018 c) the carrying amount of the machine on 31 December 2017 (immediately before the impairment). d) the impairment loss recognized in the year to 31 December 2019. e) The depreciation charge in the year to 31 December 2019.
- Best Buy Company Limited (Best Buy) bought a machine for $400,000 on 1 July 2019. The machine had an estimated residual value of $50,000, and had estimated useful life of 10 years, or had an estimated operation output of 50,000 hours. The financial year-end date of Best Buy is 31 December. Required: (a) Compute the depreciation on this machine in the years of 2019 and 2020 using the following methods. (i) Straight-line (with depreciation calculated to the nearest whole month) (ii) 200%-declining-balance (with half-year convention) (iii) Units-of-output method (hours of operation:2,500 in 2019; 5,000 in 2020) 2019 (i)$________ (ii)$________ (iii)$________ 2020 (i)$________ (ii)$________ (iii)$________ (b) Which of the method(s) in part (a) would result in the highest net profit in the year of 2019?Briefly explain.Balloon Ltd (Balloon) purchased an item of equipment on 1 July 2015 for $2 million. At that time the useful life of the equipment was assessed to be 10 years, with no residual value. Balloon applies the cost model to its equipment. On 30 June 2020 the recoverable amount of the equipment was assessed to be $900,000. Accordingly, an impairment loss of $100,000 was recognised. The useful life of the equipment remained at five years. On 30 June 2023 (three years later) the same equipment's carrying amount is $360,000 and its recoverable amount is $450,000. On 30 June 2023, Balloon should recognise: an impairment reversal of $10,000 an impairment reversal of $90,000 an impairment reversal of $40,000 O nil, because the recoverable amount of the asset exceeds its carrying amountOn January 3, 2019, Soju Co. purchased machinery. The machinery has an estimated useful life of eight years and an estimated salvage value of P30,000. The depreciation applicable to this machinery was P65,000 for 2021, computed by the sum-of-the-years'-digits method. The acquisition cost of the machinery was ? a. P360,000 b. P390,000 c. P420,000 d. P468,000