Financial accounting Waco Company was started on January 1, 2011, when it issued common stockfor $15,000 cash. Also on January 1, 2011, the company purchased officeequipment that cost $15,000 cash. The equipment was delivered under termsof FOB shipping point, and the transportation cost was $1,000. The equipmenthad a five-year useful life and a $1,200 expected salvage value.Using straight-line depreciation, determine the amount of depreciationexpense and the amount of accumulated depreciation that would appear onthe December 31, 2013, financial statements.a. $2,608/$7,824.b. $2,960/$2,960.c. $2,600/$7,800.d. $2,960/$8,880.

Step 1: Define Accounting for DepreciationCompanies buy property, plant, and equipment to use over…

Answered: Waco Company was started on January 1,…

Century 21 Accounting General Journal

11th Edition

ISBN:9781337680059

Author:Gilbertson

Publisher:Gilbertson

Chapter19: Accounting For Plant Assets, Depreciation, And Intangible Assets

Section: Chapter Questions

Problem 1AFE

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When depreciation is recorded each period, what account is debited? a. Depreciation Expense b. Cash c. Accumulated Depreciation d. The fixed asset account involved Use the following information for Multiple-Choice Questions 7-4 through 7-6: Cox Inc. acquired a machine for on January 1, 2019. The machine has a salvage value of $20,000 and a 5-year useful life. Cox expects the machine to run for 15,000 machine hours. The machine was actually used for 4,200 hours in 2019 and 3,450 hours in 2020.
Martin Corporation acquired a truck on January 1, 2016, at a cost of $84,000. The truck was originally estimated to have a salvage value of $4,000 and an estimated useful life of 8 years. Depreciation had been recorded through December 31, 2018, using the straight-line method. On January 1, 2019, the estimated salvage value was revised to $6,000, and the useful life was revised to a total of 7 years. Required: (Show all calculations) Calculate the annual depreciation expense for the years 2016 through 2018. a. b. Calculate the book value of the truck at December 31, 2018. с. Calculate the depreciation expense per year after revision. d. If the truck is sold at a gain, how is the statement of financial position affected?
Coppola Company purchased a machine on January 1, 2016, for $20,000 cash. In addition, Coppola paid $4,000 to have the machine delivered and installed. The estimated useful life of the machine is 4 years, after which time it is expected to have a salvage value of $8,000. It is also estimated that the machine will produce 200,000 units of product during its useful life. Assuming that the straight-line depreciation method is used, what will be the machine's carrying amount on December 31, 2018? a.$8,000 b.$14,000 c.$12,000 d.$16,000
On April 1, 2007, Wang Manufacturing Company bought a new equipment for P800,000. The equipment has an estimated salvage value of P20,000 and useful life of 12 years. Depreciation is computed using the sum-of-the-years digits method.How much is the amount of depreciation for 2007?a. P60,000b. P75,000c. P90,000d. P20,000 What is the carrying value of this asset in the statement of financial position at December 31,2020? a. 574,800 b. 577,500 c. 597,500 d. 614.800
(Depreciation Computations, SYD) Five Satins Company purchased a piece of equipment at the beginning of 2014. The equipment cost $430,000. It has an estimated service life of 8 years and an expected salvage value of $70,000. The sumof-the-years’-digits method of depreciation is being used. Someone has already correctly prepared a depreciation schedule forthis asset. This schedule shows that $60,000 will be depreciated for a particular calendar year.InstructionsShow calculations to determine for what particular year the depreciation amount for this asset will be $60,000.
Rogers Co. had a sheet metal cutter that cost $240,000 on January 1, 2013. This old cutter had an estimated life of ten years and a salvage value of $40,000. On April 1, 2018, the old cutter is exchanged for a new cutter with a fair value of $120,000. Rogers also received $30,000 cash. Assume that the last fiscal period ended on December 31, 2017, and that straight-line depreciation is used. Instruction: Record any entries required on April 1, 2018.
Five Satins Company purchased a piece of equipment at the beginning of 2017. The equipment cost $430,000. It has an estimated service life of 8 years and an expected salvage value of $70,000. The sum-of-the-years’-digits method of depreciation is being used. Someone has already correctly prepared a depreciation schedule for this asset. This schedule shows that $60,000 will be depreciated for a particular calendar year. Instructions Show calculations to determine for what particular year the depreciation amount for this asset will be $60,000.
Gordon Chemicals Company acquires a delivery truck at a cost of $25,000 on January 1, 2017. The truck is expected to have a salvage value of $4,000 at the end of its 3-year useful life. Compute annual depreciation for the first and second years using the straight-line method. (Round answers to 0 decimal places, e.g. 125.) First Year Second Year Annual depreciation under straight-line method
Howarth Manufacturing Company purchased a lathe on June 30, 2012, at a cost of $80,000. The residual value of the lathe was estimated to be $5,000 at the end of a five-year life. The lathe was sold on March 31, 2016, for $17,000. 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 sum-of-the-years’-digits depreciation method, prepare the journal entry to record the sale.
Kelly Company purchased a bulldozer at a cost of $200,000. The bulldozer has an estimated salvage value of $25,000 and an estimated life of 10 years, or 15,000 hours of operation. The bulldozer was purchased on January 1, 2018, and was used 3,000 hours in 2018 and 2,500 hours in 2019. What amount will Kelly Company report as depreciation expense over the 10-year life of the equipment using straight-line depreciation?
Dengar
The Black Limo Company (BLC) purchased a limo on January 1 of Year 1. The limo cost $48,000. It had an expected useful life of 4 years and an $8,000 salvage value. Assume BLC uses straight-line depreciation. At the beginning of Year 3, the limo is sold for $30,000 cash. As a result of the asset disposal BLC will recognize a ______ activities.

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