Depreciation: It refers to the reduction in the monetary value of fixed tangible assets over its useful life due to its wear and tear or, obsolescence. In other words, it is the method of distributing the cost of tangible fixed assets over its estimated useful life. Straight-line Depreciation: Under the straight-line method of depreciation, the same amount of depreciation is allocated every year over the estimated useful life of an asset. The formula to calculate the depreciation cost of the asset using the residual value is shown as below: Depreciation = ( Cost of the asset − Residual value ) Estimated useful life of the asset Sum-of- the-years’ digits method: Sum-of-the years’ digits method determines the depreciation by multiplying the depreciable base and declining fraction. To prepare: The year-end journal entry for depreciation in 2016.

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Answer 1

Question

Chapter 11, Problem 11.19E

Requirement – 1

To determine

Depreciation:

It refers to the reduction in the monetary value of fixed tangible assets over its useful life due to its wear and tear or, obsolescence. In other words, it is the method of distributing the cost of tangible fixed assets over its estimated useful life.

Straight-line Depreciation:

Under the straight-line method of depreciation, the same amount of depreciation is allocated every year over the estimated useful life of an asset. The formula to calculate the depreciation cost of the asset using the residual value is shown as below:

Depreciation = (Cost of the asset−Residual value)Estimated useful life of the asset

Sum-of- the-years’ digits method:

Sum-of-the years’ digits method determines the depreciation by multiplying the depreciable base and declining fraction.

To prepare: The year-end journal entry for depreciation in 2016.

Requirement – 2

To determine

To prepare: The year-end journal entry for depreciation in 2016, assume Company W uses the sum-of-the-years’-digits methods.

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Answer 2

Question

Chapter 11, Problem 11.19E

Requirement – 1

To determine

Depreciation:

It refers to the reduction in the monetary value of fixed tangible assets over its useful life due to its wear and tear or, obsolescence. In other words, it is the method of distributing the cost of tangible fixed assets over its estimated useful life.

Straight-line Depreciation:

Under the straight-line method of depreciation, the same amount of depreciation is allocated every year over the estimated useful life of an asset. The formula to calculate the depreciation cost of the asset using the residual value is shown as below:

Depreciation = (Cost of the asset−Residual value)Estimated useful life of the asset

Sum-of- the-years’ digits method:

Sum-of-the years’ digits method determines the depreciation by multiplying the depreciable base and declining fraction.

To prepare: The year-end journal entry for depreciation in 2016.

Requirement – 2

To determine

To prepare: The year-end journal entry for depreciation in 2016, assume Company W uses the sum-of-the-years’-digits methods.

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Answer 3

Question

Chapter 11, Problem 11.19E

Requirement – 1

To determine

Depreciation:

It refers to the reduction in the monetary value of fixed tangible assets over its useful life due to its wear and tear or, obsolescence. In other words, it is the method of distributing the cost of tangible fixed assets over its estimated useful life.

Straight-line Depreciation:

Under the straight-line method of depreciation, the same amount of depreciation is allocated every year over the estimated useful life of an asset. The formula to calculate the depreciation cost of the asset using the residual value is shown as below:

Depreciation = (Cost of the asset−Residual value)Estimated useful life of the asset

Sum-of- the-years’ digits method:

Sum-of-the years’ digits method determines the depreciation by multiplying the depreciable base and declining fraction.

To prepare: The year-end journal entry for depreciation in 2016.

Requirement – 2

To determine

To prepare: The year-end journal entry for depreciation in 2016, assume Company W uses the sum-of-the-years’-digits methods.

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Answer 4

Question

Chapter 11, Problem 11.19E

Requirement – 1

To determine

Depreciation:

It refers to the reduction in the monetary value of fixed tangible assets over its useful life due to its wear and tear or, obsolescence. In other words, it is the method of distributing the cost of tangible fixed assets over its estimated useful life.

Straight-line Depreciation:

Under the straight-line method of depreciation, the same amount of depreciation is allocated every year over the estimated useful life of an asset. The formula to calculate the depreciation cost of the asset using the residual value is shown as below:

Depreciation = (Cost of the asset−Residual value)Estimated useful life of the asset

Sum-of- the-years’ digits method:

Sum-of-the years’ digits method determines the depreciation by multiplying the depreciable base and declining fraction.

To prepare: The year-end journal entry for depreciation in 2016.

Requirement – 2

To determine

To prepare: The year-end journal entry for depreciation in 2016, assume Company W uses the sum-of-the-years’-digits methods.

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Answer 5

Chapter 11, Problem 11.19E

Requirement – 1

To determine

Depreciation:

It refers to the reduction in the monetary value of fixed tangible assets over its useful life due to its wear and tear or, obsolescence. In other words, it is the method of distributing the cost of tangible fixed assets over its estimated useful life.

Straight-line Depreciation:

Under the straight-line method of depreciation, the same amount of depreciation is allocated every year over the estimated useful life of an asset. The formula to calculate the depreciation cost of the asset using the residual value is shown as below:

Depreciation = (Cost of the asset−Residual value)Estimated useful life of the asset

Sum-of- the-years’ digits method:

Sum-of-the years’ digits method determines the depreciation by multiplying the depreciable base and declining fraction.

To prepare: The year-end journal entry for depreciation in 2016.

Requirement – 2

To determine

To prepare: The year-end journal entry for depreciation in 2016, assume Company W uses the sum-of-the-years’-digits methods.

Answer 6

Chapter 11, Problem 11.19E

Requirement – 1

To determine

Depreciation:

It refers to the reduction in the monetary value of fixed tangible assets over its useful life due to its wear and tear or, obsolescence. In other words, it is the method of distributing the cost of tangible fixed assets over its estimated useful life.

Straight-line Depreciation:

Under the straight-line method of depreciation, the same amount of depreciation is allocated every year over the estimated useful life of an asset. The formula to calculate the depreciation cost of the asset using the residual value is shown as below:

Depreciation = (Cost of the asset−Residual value)Estimated useful life of the asset

Sum-of- the-years’ digits method:

Sum-of-the years’ digits method determines the depreciation by multiplying the depreciable base and declining fraction.

To prepare: The year-end journal entry for depreciation in 2016.

Answer 7

Chapter 11, Problem 11.19E

Requirement – 1

To determine

Depreciation:

It refers to the reduction in the monetary value of fixed tangible assets over its useful life due to its wear and tear or, obsolescence. In other words, it is the method of distributing the cost of tangible fixed assets over its estimated useful life.

Straight-line Depreciation:

Under the straight-line method of depreciation, the same amount of depreciation is allocated every year over the estimated useful life of an asset. The formula to calculate the depreciation cost of the asset using the residual value is shown as below:

Depreciation = (Cost of the asset−Residual value)Estimated useful life of the asset

Sum-of- the-years’ digits method:

Sum-of-the years’ digits method determines the depreciation by multiplying the depreciable base and declining fraction.

To prepare: The year-end journal entry for depreciation in 2016.

Answer 8

Requirement – 2

To determine

To prepare: The year-end journal entry for depreciation in 2016, assume Company W uses the sum-of-the-years’-digits methods.

Answer 9

Requirement – 2

To determine

To prepare: The year-end journal entry for depreciation in 2016, assume Company W uses the sum-of-the-years’-digits methods.

Answer 10

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Answer 11

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Answer 12

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Answer 13

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To prepare: The year-end journal entry for depreciation in 2016, assume Company W uses the sum-of-the-years’-digits methods.

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