Sunset Manufacturing has an original basis of $30,000 for an asset, and depreciation of $15,000 has been claimed. If the asset's adjusted basis is $18,000, what is the amount of capital improvements that have been made to the asset? a) $3,000 b) $8,000 c) $10,000 d) $15,000 e) None of these choices are correct
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- If an item is capitalized why do you think different depreciation methods are allowed? Does the depreciation method chosen impact Net Income in the short term? What about over the life of the asset? Assume you have an asset with original cost of $150,000 and accumulated depreciation of $30,000 when you spend $10,000 on the asset. If the $10,000 is an ordinary repair what is the Book Value Before and the Book Value after the $10,000 expenditure? If the $10.000 expenditure is an Extraordinary Repair (extends the life of the asset) and is recorded as a debit to Accumulated Depreciation and a credit to Cash What is the Book Value Before and the Book Value after the $10,000 expenditure? if the expenditure is a Betterment (improves the function of the asset) and is recorded as a debit to the asset and a credit to Cash. What is the Book Value Before and the Book Value after the $10,000 expenditure?At the end of 2020, Magenta Manufacturing Company discovered that construction cost had been capitalized as a cost of the factory building in 2015 when it should have been treated as a cost of production equipment installation costs. As a result of the misclassification, the depreciation through 2018 was understated by 110,000, and depreciation for 2019 was understated by 90,000. What would be the consequences of correcting for the misclassification of the property cost? a. The taxpayer uses the FIFO inventory method, and 25% of goods produced during the period were included in the ending inventory. b. The taxpayer uses the LIFO inventory method, and no new LIFO layer was added during 2019.An asset used in a 4-year project falls in the 5-year MACRS class, for tax purposes. The asset has an acquisition cost of $20,349,349 and will be sold for $7,887,127 at the end of the project. If the tax rate is 0.29, what is the aftertax salvage value of the asset (SVNOT)? Modified ACRS depreciation allowances TABLE 9.7 Year 12345678 2 3-Year 33.33% 44.45 14.81 7.41 Property Class 5-Year 20.00% 32.00 19.20 11.52 11.52 5.76 7-Year 14.29% 24.49 17.49 12.49 8.93 8.92 8.93 4.46
- A fixed asset with a cost of dollar 42,200 and accumulated depreciation of dollar 36,500 is sold for dollar 9,850. What is the amount of the gain or loss on disposal of the fixed asset? Answer this below QuestionAssume that additional information has been provided relating to the cost ($984,000). There are three components of the plant asset. Components 1, 2, and 3 have costs of $405,000, $260,000, and $319,000, respectively. The useful lives of components 1, 2, and 3 are 25, 20, and 30 years, respectively. Determine straight-line depreciation expense for 2020 and 2021 for each component under IFRS if the residual value is $140,000 for component 1, $168,000 for component 2, and $76,000 for component 3. (Do not round intermediate calculations and round answers to 0 decimal places, e.g. 5,275.) Depreciation expense 2020 2021 Component 1 10600 Component 2 4600 Component 3 8100Godo
- Current Attempt in Progress Consider an asset that was separated into its main components A, B and C). The $1242000 purchase price was allocated to these components in equal proportions. The useful lives are 12, 4, and 7 years for components A, B, and C respectively. Components A and B are not expected to have any residual value, but Component C is expected to have a residual value of $18600. Assuming straight-line depreciation, total annual depreciation expense. to the nearest dollar relating to these assets is O $130071. O $103500 O $194486 O $197143.What is the correct option? ?if a company chooses the revaluation model permitted in IAS 16 for measuring non-current assets, then which of the following statements is correct? OA. Annual revaluations must be performed on each class of assets B. It must be revalued at the depreciated replacement cost OC. If an item of plant is revalued, then all items within that class must also be revalued OD. None of the above
- 5.The Jones Corp. purchased an investment property on Jan 1, 2017 for a cost of P220,000. The property had a useful life of 40 years and at Dec 31, 2020 had a fair value of P300,000. On Dec 31, 2021 the property was sold for P290,000 incurring disposal costs of P10,000. Jones uses the cost model to account for investment properties. What is the gain or loss to be recognized in profit or loss for the year ended Dec 31, 2021 regarding the disposal of the property?Crane Inc. owns assets to which it applies the revaluation model (asset-adjustment method). The following additional information is available: 1. The depreciation expense for 2024 was $6780. 2. Between December 31, 2023, and December 31, 2024, the property's fair value had increased by $33900. 3. The December 31, 2024, balance in the revaluation surplus account (prior to any fair value adjustments) was $2260. The adjusted December 31, 2024, balance in the related contra-asset account will be ○ $11300. $15820. ○ $0. ○ $13560.Your company has purchased a large new trucktractor for over-the-road use (asset class 00.26). It has a cost basis of $179,000. With additional options costing $14,000, the cost basis for depreciation purposes is $193,000. Its MV at the end of six years is estimated as $36,000. Assume it will be depreciated under the GDS: a. What is the cumulative depreciation through the end of year two? b. What is the MACRS depreciation in the second year? c. What is the BV at the end of year one? Click the icon to view the partial listing of depreciable assets used in business. Click the icon to view the GDS Recovery Rates (rk). a. The cumulative depreciation through the end of year two is $ (Round to the nearest dollar.) b. The MACRS depreciation in the second year is $ (Round to the nearest dollar.) c. The BV at the end of year one is $ (Round to the nearest dollar.)
