Intermediate Accounting
3rd Edition
ISBN: 9780136912644
Author: Elizabeth A. Gordon; Jana S. Raedy; Alexander J. Sannella
Publisher: Pearson Education (US)
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Question
Chapter 11, Problem 11.3MC
To determine
To identify: The correct option.
Given information:
Cost of
Salvage value is $40,000.
Useful life of machinery is 10 years.
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Mohr Company purchases a machine at the beginning of the year at a cost of $24,000. The machine is depreciated using the double-declining-balance method. The machine’s useful life is estimated to be 5 years with a $4,000 salvage value. The machine’s book value at the end of year 2 is:
A. $12,000.
B. $7,200.
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E. $14,400.
Slovac Company purchased a machine that has an estimated useful life of eight years for $7,500. Its salvage value is estimated at $500. What is the depreciation for the second year of the asset’s life, assuming Slovac uses the double-declining-balance method of depreciation? a. $1,406 b. $1,438 c. $1,875 d. $3,750
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Mohr Company purchases a machine at the beginning of the year at a cost of $36,000. The machine is
depreciated using the straight-line method. The machine's
useful life is estimated to be 8 years with a $5,000 salvage value. Depreciation expense in year 2 is:
Multiple Choice
$9,000.
$31,000.
$4,500.
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$0.
Chapter 11 Solutions
Intermediate Accounting
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