Skysong Company purchased a new machine on September 1, 2022, at a cost of $125,000. The company estimated that the machine will have a salvage value of $12,000. The machine is expected t be used for 10,000 working hours during its 5-year life. Assume the double - declining balance method is used. What amount of gain or loss would Skysong recognize if they sell the asset for $ 50,000 on 12/31/24? Assume the double-declining balance method is used. What amount of gain or loss would Skysong recognize if they sell the asset for $50,000 on 12/31/24? gain

Skysong Company purchased a new machine on September 1, 2022, at a cost of $125,000. The company estimated that the machine will have a salvage value of $12,000. The machine is expected t be used for 10,000 working hours during its 5-year life. Assume the double - declining balance method is used. What amount of gain or loss would Skysong recognize if they sell the asset for $ 50,000 on 12/31/24? Assume the double-declining balance method is used. What amount of gain or loss would Skysong recognize if they sell the asset for $50,000 on 12/31/24? gain

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

A company purchased a new machine on May 1, 2012 for $528,000. At the time of acquisition, the machine was estimated to have a useful life of ten years and an estimated salvage value of $24,000. The company has recorded monthly depreciation using the straight-line method. On March 1, 2021, the machine was sold for $82,000. What should be the gain/loss recognized from the sale of the machine?
Weber Enterprises purchased a depreciable asset on June 30, 2016 at a cost of $100,000. The asset is expected to have a salvage value of $15,000 at the end of its five-year useful life. It uses the double declining balance method of depreciation. Weber Enterprises should recognize what amount of salvage value in 2019?
Metlock Corporation purchased a new machine for its assembly process on August 1, 2025. The cost of this machine was $141,600. The company estimated that the machine would have a salvage value of $15,600 at the end of its service life. It's life is estimated at 5 years, and it's working hours are estimated at 20,000 hours. Year-end is December 31. Could you calculate the depreciation expense for the Sum-of-the-years'-digits for 2026?
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.
Warhol Enterprises purchased a spray painter at the beginning of 2018 at a cost of $150,000. Costs for training personnel on usage of this painter were $200. Warhol estimated that the spray painter would have a residual value of $30,000. The company decided to use declining-balance method of depreciation at a rate of 20%. Two years later, at the end of 2020, Warhol sold the spray painter for $120,000.a. Calculate the book value of the spray painter at the end of 2018 and the end of 2019, prior to its sale.b. Calculate the gain or loss on the sale of the spray painter.c. Calculate the income statement effect, assuming that Warhol decided to give the spray painter to a charitable foundation.
Haystack company purchased a machine on January 1, 2015 for $48,000. The company estimates that the machine will have a $4,000 salvage value at the end of its 10 year useful life. On September 30, 2019 the machine was sold for a gain of $3,500. What must have been the selling price of the machine?
Howarth Manufacturing Company purchased equipment on June 30, 2020, at a cost of $170,000. The residual value of the equipment was estimated to be $20,000 at the end of a five-year life. The equipment was sold on March 31, 2024, for $54,000. Howarth uses the straight-line depreciation method for all of its plant and equipment. Partial-year depreciation is calculated based on the number of months the asset is in service. Required: 1. Prepare the journal entry to record the sale. 2. Assuming that Howarth had instead used the double-declining-balance method, prepare the journal entry to record the sale. + Complete this question by entering your answers in the tabs below. Required 1 No Prepare the journal entry to record the sale. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. General Journal 1 Required 2 No Event 1 1 Required 1 Required 2 Answer is not complete. 10 Event 1 Cash Accumulated depreciation-equipment Loss…
Blue Corporation purchased a new machine for its assembly process on August 1, 2025. The cost of this machine was $169,800. The company estimated that the machine would have a salvage value of $16,800 at the end of its service life. Its life is estimated at 5 years, and its working hours are estimated at 20,000 hours. Year-end is December 31. Compute the depreciation expense under the following methods. Each of the following should be considered unrelated. (Round depreciation rate per hour to 2 decimal places, e.g. 5.35 for computational purposes. Round your answers to O decimal places, e.g. 45,892.) (a) Straight-line depreciation for 2025 (b) (c) (d) Activity method for 2025, assuming that machine usage was 800 hours Sum-of-the-years'-digits for 2026 Double-declining-balance for 2026 GA $ GA GA $ $
On March 10, 2027, Skysong Company sells equipment that it purchased for $203,520 on August 20, 2020. It was originally estimated that the equipment would have a life of 12 years and a salvage value of $17,808 at the end of that time, and depreciation has been computed on that basis. The company uses the straight-line method of depreciation. (a) Compute the depreciation charge on this equipment for 2020, for 2027, and the total charge for the period from 2021 to 2026, inclusive, under each of the six following assumptions with respect to partial periods. (Round depreciation per day to 2 decimal places, e.g. 15.64 and final answers to O decimal places, e.g. 45,892.) 1. Depreciation is computed for the exact period of time during which the asset is owned. (Use 365 days for base and record depreciation through March 9, 2027.) 2. Depreciation is computed for the full year on the January 1 balance in the asset account. 3. 4. Depreciation for one-half year is charged on plant assets acquired…
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
A Company purchased a piece of machinery for $60,000 on January 1, 2019 and has been depreciating the machine using the double-declining-balance method based on a five-year estimated useful life and $10,000 salvage value. On January 1, 2021, A Company decided to switch to the straight-line method of depreciation. The salvage value is still $10,000 and the estimated useful life did not change. Ignore income taxes. Required: (show the computing process and precise journal entries) (1) Prepare the appropriate journal entry, if any, to record the accounting change. (2) Prepare the journal entry to record depreciation for 2021.
Wildhorse Corporation bought a machine on June 1, 2023, for $36,600, f.o.b. the place of manufacture. Freight to the point where it was set up was $240, and $560 was expended to install it. The machine’s useful life was estimated at 10 years, with a salvage value of $2,950. On June 1, 2024, an essential part of the machine is replaced, at a cost of $2,430, with one designed to reduce the cost of operating the machine. The cost of the old part and related depreciation cannot be determined with any accuracy.On June 1, 2027, the company buys a new machine of greater capacity for $41,300, delivered, trading in the old machine which has a fair value and trade-in allowance of $23,600. Preparing the old machine for removal from the plant cost $89, and expenditures to install the new one were $1,770. It is estimated that the new machine has a useful life of 10 years, with a salvage value of $4,720 at the end of that time. (The exchange has commercial substance.)Assuming that depreciation is to…