Straight line method of depreciation: This is one of the methods to calculate the depreciation on assets. Under this method the depreciable value of asset it divided equally for each year f its estimated life. The formula to calculate the deprecation under straight line method is as follows: A n n u a l S t r a i g h t l i n e d e p r e c i a t i o n = ( C o s t − S a l v a g e V a l u e ) E s t i m a t e d l i f e i n y e a r s Requirement-1: To Calculate: The Net Income for each year using the Straight Line Method

Question

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Answer 1

Question

Chapter 7, Problem 7.3.2C

To determine

Concept Introduction:

Straight line method of depreciation:

This is one of the methods to calculate the depreciation on assets. Under this method the depreciable value of asset it divided equally for each year f its estimated life. The formula to calculate the deprecation under straight line method is as follows:

Annual Straight line depreciation = (Cost− Salvage Value)Estimated life in years

Requirement-1:

To Calculate:

The Net Income for each year using the Straight Line Method

Expert Solution

Answer to Problem 7.3.2C

The Net income for each year using the Straight Line Method is as follows:

Year	Net income
20Y2	$ 222,000
20Y3	$ 444,000
20Y4	$ 444,000
20Y5	$ 444,000
20Y6	$ 444,000
20Y7	$ 462,000

Explanation of Solution

The Net Income for each year using the Straight Line Method is calculated as follows:

Year	Income before Depreciation and Tax	Depreciation	Income before Tax	Income Tax	Net income
	A	B	C =A-B	*D=C40%**	E=C-D
20Y2	$ 400,000	$ 30,000	$ 370,000	$148,000	$ 222,000
20Y3	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y4	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y5	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y6	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y7	$ 800,000	$ 30,000	$ 770,000	$308,000	$ 462,000

To determine

Concept Introduction:

Straight line method of depreciation:

This is one of the methods to calculate the depreciation on assets. Under this method the depreciable value of asset it divided equally for each year f its estimated life. The formula to calculate the deprecation under straight line method is as follows:

Annual Straight line depreciation = (Cost− Salvage Value)Estimated life in years

Requirement-1:

To Calculate:

The Net Income for each year using the MCRS Method

Year Net income
20Y2 $ 222,000
20Y3 $ 422,400
20Y4 $ 445,440
20Y5 $ 459,264
20Y6 $ 459,264
20Y7 $ 469,632

Expert Solution

Answer to Problem 7.3.2C

The Net Income for each year using the MCRS Method is as follows:

Explanation of Solution

The Net Income for each year using the MCRS Method is calculated as follows:

Year	Income before Depreciation and Tax	Depreciation	Income before Tax	Income Tax	Net income
	A	B	C =A-B	*D=C40%**	E=C-D
20Y2	$ 400,000	$ 30,000	$ 370,000	$148,000	$ 222,000
20Y3	$ 800,000	$ 96,000	$ 704,000	$281,600	$ 422,400
20Y4	$ 800,000	$ 57,600	$ 742,400	$296,960	$ 445,440
20Y5	$ 800,000	$ 34,560	$ 765,440	$306,176	$ 459,264
20Y6	$ 800,000	$ 34,560	$ 765,440	$306,176	$ 459,264
20Y7	$ 800,000	$ 17,280	$ 782,720	$313,088	$ 469,632

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Answer 2

Question

Chapter 7, Problem 7.3.2C

To determine

Concept Introduction:

Straight line method of depreciation:

This is one of the methods to calculate the depreciation on assets. Under this method the depreciable value of asset it divided equally for each year f its estimated life. The formula to calculate the deprecation under straight line method is as follows:

Annual Straight line depreciation = (Cost− Salvage Value)Estimated life in years

Requirement-1:

To Calculate:

The Net Income for each year using the Straight Line Method

Expert Solution

Answer to Problem 7.3.2C

The Net income for each year using the Straight Line Method is as follows:

Year	Net income
20Y2	$ 222,000
20Y3	$ 444,000
20Y4	$ 444,000
20Y5	$ 444,000
20Y6	$ 444,000
20Y7	$ 462,000

Explanation of Solution

The Net Income for each year using the Straight Line Method is calculated as follows:

Year	Income before Depreciation and Tax	Depreciation	Income before Tax	Income Tax	Net income
	A	B	C =A-B	*D=C40%**	E=C-D
20Y2	$ 400,000	$ 30,000	$ 370,000	$148,000	$ 222,000
20Y3	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y4	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y5	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y6	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y7	$ 800,000	$ 30,000	$ 770,000	$308,000	$ 462,000

To determine

Concept Introduction:

Straight line method of depreciation:

This is one of the methods to calculate the depreciation on assets. Under this method the depreciable value of asset it divided equally for each year f its estimated life. The formula to calculate the deprecation under straight line method is as follows:

Annual Straight line depreciation = (Cost− Salvage Value)Estimated life in years

Requirement-1:

To Calculate:

The Net Income for each year using the MCRS Method

Year Net income
20Y2 $ 222,000
20Y3 $ 422,400
20Y4 $ 445,440
20Y5 $ 459,264
20Y6 $ 459,264
20Y7 $ 469,632

Expert Solution

Answer to Problem 7.3.2C

The Net Income for each year using the MCRS Method is as follows:

Explanation of Solution

The Net Income for each year using the MCRS Method is calculated as follows:

Year	Income before Depreciation and Tax	Depreciation	Income before Tax	Income Tax	Net income
	A	B	C =A-B	*D=C40%**	E=C-D
20Y2	$ 400,000	$ 30,000	$ 370,000	$148,000	$ 222,000
20Y3	$ 800,000	$ 96,000	$ 704,000	$281,600	$ 422,400
20Y4	$ 800,000	$ 57,600	$ 742,400	$296,960	$ 445,440
20Y5	$ 800,000	$ 34,560	$ 765,440	$306,176	$ 459,264
20Y6	$ 800,000	$ 34,560	$ 765,440	$306,176	$ 459,264
20Y7	$ 800,000	$ 17,280	$ 782,720	$313,088	$ 469,632

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Answer 3

Question

Chapter 7, Problem 7.3.2C

To determine

Concept Introduction:

Straight line method of depreciation:

This is one of the methods to calculate the depreciation on assets. Under this method the depreciable value of asset it divided equally for each year f its estimated life. The formula to calculate the deprecation under straight line method is as follows:

Annual Straight line depreciation = (Cost− Salvage Value)Estimated life in years

Requirement-1:

To Calculate:

The Net Income for each year using the Straight Line Method

Expert Solution

Answer to Problem 7.3.2C

The Net income for each year using the Straight Line Method is as follows:

Year	Net income
20Y2	$ 222,000
20Y3	$ 444,000
20Y4	$ 444,000
20Y5	$ 444,000
20Y6	$ 444,000
20Y7	$ 462,000

Explanation of Solution

The Net Income for each year using the Straight Line Method is calculated as follows:

Year	Income before Depreciation and Tax	Depreciation	Income before Tax	Income Tax	Net income
	A	B	C =A-B	*D=C40%**	E=C-D
20Y2	$ 400,000	$ 30,000	$ 370,000	$148,000	$ 222,000
20Y3	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y4	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y5	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y6	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y7	$ 800,000	$ 30,000	$ 770,000	$308,000	$ 462,000

To determine

Concept Introduction:

Straight line method of depreciation:

This is one of the methods to calculate the depreciation on assets. Under this method the depreciable value of asset it divided equally for each year f its estimated life. The formula to calculate the deprecation under straight line method is as follows:

Annual Straight line depreciation = (Cost− Salvage Value)Estimated life in years

Requirement-1:

To Calculate:

The Net Income for each year using the MCRS Method

Year Net income
20Y2 $ 222,000
20Y3 $ 422,400
20Y4 $ 445,440
20Y5 $ 459,264
20Y6 $ 459,264
20Y7 $ 469,632

Expert Solution

Answer to Problem 7.3.2C

The Net Income for each year using the MCRS Method is as follows:

Explanation of Solution

The Net Income for each year using the MCRS Method is calculated as follows:

Year	Income before Depreciation and Tax	Depreciation	Income before Tax	Income Tax	Net income
	A	B	C =A-B	*D=C40%**	E=C-D
20Y2	$ 400,000	$ 30,000	$ 370,000	$148,000	$ 222,000
20Y3	$ 800,000	$ 96,000	$ 704,000	$281,600	$ 422,400
20Y4	$ 800,000	$ 57,600	$ 742,400	$296,960	$ 445,440
20Y5	$ 800,000	$ 34,560	$ 765,440	$306,176	$ 459,264
20Y6	$ 800,000	$ 34,560	$ 765,440	$306,176	$ 459,264
20Y7	$ 800,000	$ 17,280	$ 782,720	$313,088	$ 469,632

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Answer 4

Question

Chapter 7, Problem 7.3.2C

To determine

Concept Introduction:

Straight line method of depreciation:

This is one of the methods to calculate the depreciation on assets. Under this method the depreciable value of asset it divided equally for each year f its estimated life. The formula to calculate the deprecation under straight line method is as follows:

Annual Straight line depreciation = (Cost− Salvage Value)Estimated life in years

Requirement-1:

To Calculate:

The Net Income for each year using the Straight Line Method

Expert Solution

Answer to Problem 7.3.2C

The Net income for each year using the Straight Line Method is as follows:

Year	Net income
20Y2	$ 222,000
20Y3	$ 444,000
20Y4	$ 444,000
20Y5	$ 444,000
20Y6	$ 444,000
20Y7	$ 462,000

Explanation of Solution

The Net Income for each year using the Straight Line Method is calculated as follows:

Year	Income before Depreciation and Tax	Depreciation	Income before Tax	Income Tax	Net income
	A	B	C =A-B	*D=C40%**	E=C-D
20Y2	$ 400,000	$ 30,000	$ 370,000	$148,000	$ 222,000
20Y3	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y4	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y5	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y6	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y7	$ 800,000	$ 30,000	$ 770,000	$308,000	$ 462,000

To determine

Concept Introduction:

Straight line method of depreciation:

This is one of the methods to calculate the depreciation on assets. Under this method the depreciable value of asset it divided equally for each year f its estimated life. The formula to calculate the deprecation under straight line method is as follows:

Annual Straight line depreciation = (Cost− Salvage Value)Estimated life in years

Requirement-1:

To Calculate:

The Net Income for each year using the MCRS Method

Year Net income
20Y2 $ 222,000
20Y3 $ 422,400
20Y4 $ 445,440
20Y5 $ 459,264
20Y6 $ 459,264
20Y7 $ 469,632

Expert Solution

Answer to Problem 7.3.2C

The Net Income for each year using the MCRS Method is as follows:

Explanation of Solution

The Net Income for each year using the MCRS Method is calculated as follows:

Year	Income before Depreciation and Tax	Depreciation	Income before Tax	Income Tax	Net income
	A	B	C =A-B	*D=C40%**	E=C-D
20Y2	$ 400,000	$ 30,000	$ 370,000	$148,000	$ 222,000
20Y3	$ 800,000	$ 96,000	$ 704,000	$281,600	$ 422,400
20Y4	$ 800,000	$ 57,600	$ 742,400	$296,960	$ 445,440
20Y5	$ 800,000	$ 34,560	$ 765,440	$306,176	$ 459,264
20Y6	$ 800,000	$ 34,560	$ 765,440	$306,176	$ 459,264
20Y7	$ 800,000	$ 17,280	$ 782,720	$313,088	$ 469,632

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Answer 5

Chapter 7, Problem 7.3.2C

To determine

Concept Introduction:

Straight line method of depreciation:

This is one of the methods to calculate the depreciation on assets. Under this method the depreciable value of asset it divided equally for each year f its estimated life. The formula to calculate the deprecation under straight line method is as follows:

Annual Straight line depreciation = (Cost− Salvage Value)Estimated life in years

Requirement-1:

To Calculate:

The Net Income for each year using the Straight Line Method

Expert Solution

Answer to Problem 7.3.2C

The Net income for each year using the Straight Line Method is as follows:

Year	Net income
20Y2	$ 222,000
20Y3	$ 444,000
20Y4	$ 444,000
20Y5	$ 444,000
20Y6	$ 444,000
20Y7	$ 462,000

Explanation of Solution

The Net Income for each year using the Straight Line Method is calculated as follows:

Year	Income before Depreciation and Tax	Depreciation	Income before Tax	Income Tax	Net income
	A	B	C =A-B	*D=C40%**	E=C-D
20Y2	$ 400,000	$ 30,000	$ 370,000	$148,000	$ 222,000
20Y3	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y4	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y5	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y6	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y7	$ 800,000	$ 30,000	$ 770,000	$308,000	$ 462,000

To determine

Concept Introduction:

Straight line method of depreciation:

This is one of the methods to calculate the depreciation on assets. Under this method the depreciable value of asset it divided equally for each year f its estimated life. The formula to calculate the deprecation under straight line method is as follows:

Annual Straight line depreciation = (Cost− Salvage Value)Estimated life in years

Requirement-1:

To Calculate:

The Net Income for each year using the MCRS Method

Year Net income
20Y2 $ 222,000
20Y3 $ 422,400
20Y4 $ 445,440
20Y5 $ 459,264
20Y6 $ 459,264
20Y7 $ 469,632

Expert Solution

Answer to Problem 7.3.2C

The Net Income for each year using the MCRS Method is as follows:

Explanation of Solution

The Net Income for each year using the MCRS Method is calculated as follows:

Year	Income before Depreciation and Tax	Depreciation	Income before Tax	Income Tax	Net income
	A	B	C =A-B	*D=C40%**	E=C-D
20Y2	$ 400,000	$ 30,000	$ 370,000	$148,000	$ 222,000
20Y3	$ 800,000	$ 96,000	$ 704,000	$281,600	$ 422,400
20Y4	$ 800,000	$ 57,600	$ 742,400	$296,960	$ 445,440
20Y5	$ 800,000	$ 34,560	$ 765,440	$306,176	$ 459,264
20Y6	$ 800,000	$ 34,560	$ 765,440	$306,176	$ 459,264
20Y7	$ 800,000	$ 17,280	$ 782,720	$313,088	$ 469,632

Answer 6

Chapter 7, Problem 7.3.2C

To determine

Concept Introduction:

Straight line method of depreciation:

This is one of the methods to calculate the depreciation on assets. Under this method the depreciable value of asset it divided equally for each year f its estimated life. The formula to calculate the deprecation under straight line method is as follows:

Annual Straight line depreciation = (Cost− Salvage Value)Estimated life in years

Requirement-1:

To Calculate:

The Net Income for each year using the Straight Line Method

Expert Solution

Answer to Problem 7.3.2C

The Net income for each year using the Straight Line Method is as follows:

Year	Net income
20Y2	$ 222,000
20Y3	$ 444,000
20Y4	$ 444,000
20Y5	$ 444,000
20Y6	$ 444,000
20Y7	$ 462,000

Explanation of Solution

The Net Income for each year using the Straight Line Method is calculated as follows:

Year	Income before Depreciation and Tax	Depreciation	Income before Tax	Income Tax	Net income
	A	B	C =A-B	*D=C40%**	E=C-D
20Y2	$ 400,000	$ 30,000	$ 370,000	$148,000	$ 222,000
20Y3	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y4	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y5	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y6	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y7	$ 800,000	$ 30,000	$ 770,000	$308,000	$ 462,000

Answer 7

Chapter 7, Problem 7.3.2C

To determine

Concept Introduction:

Straight line method of depreciation:

This is one of the methods to calculate the depreciation on assets. Under this method the depreciable value of asset it divided equally for each year f its estimated life. The formula to calculate the deprecation under straight line method is as follows:

Annual Straight line depreciation = (Cost− Salvage Value)Estimated life in years

Requirement-1:

To Calculate:

The Net Income for each year using the Straight Line Method

Answer 8

Expert Solution

Answer to Problem 7.3.2C

The Net income for each year using the Straight Line Method is as follows:

Year	Net income
20Y2	$ 222,000
20Y3	$ 444,000
20Y4	$ 444,000
20Y5	$ 444,000
20Y6	$ 444,000
20Y7	$ 462,000

Answer 9

Expert Solution

Answer 10

Expert Solution

Answer 11

Expert Solution

Answer 12

Explanation of Solution

The Net Income for each year using the Straight Line Method is calculated as follows:

Year	Income before Depreciation and Tax	Depreciation	Income before Tax	Income Tax	Net income
	A	B	C =A-B	*D=C40%**	E=C-D
20Y2	$ 400,000	$ 30,000	$ 370,000	$148,000	$ 222,000
20Y3	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y4	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y5	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y6	$ 800,000	$ 60,000	$ 740,000	$296,000	$ 444,000
20Y7	$ 800,000	$ 30,000	$ 770,000	$308,000	$ 462,000

Answer 13

To determine

Concept Introduction:

Straight line method of depreciation:

This is one of the methods to calculate the depreciation on assets. Under this method the depreciable value of asset it divided equally for each year f its estimated life. The formula to calculate the deprecation under straight line method is as follows:

Annual Straight line depreciation = (Cost− Salvage Value)Estimated life in years

Requirement-1:

To Calculate:

The Net Income for each year using the MCRS Method

Year Net income
20Y2 $ 222,000
20Y3 $ 422,400
20Y4 $ 445,440
20Y5 $ 459,264
20Y6 $ 459,264
20Y7 $ 469,632

Expert Solution

Answer to Problem 7.3.2C

The Net Income for each year using the MCRS Method is as follows:

Explanation of Solution

The Net Income for each year using the MCRS Method is calculated as follows:

Year	Income before Depreciation and Tax	Depreciation	Income before Tax	Income Tax	Net income
	A	B	C =A-B	*D=C40%**	E=C-D
20Y2	$ 400,000	$ 30,000	$ 370,000	$148,000	$ 222,000
20Y3	$ 800,000	$ 96,000	$ 704,000	$281,600	$ 422,400
20Y4	$ 800,000	$ 57,600	$ 742,400	$296,960	$ 445,440
20Y5	$ 800,000	$ 34,560	$ 765,440	$306,176	$ 459,264
20Y6	$ 800,000	$ 34,560	$ 765,440	$306,176	$ 459,264
20Y7	$ 800,000	$ 17,280	$ 782,720	$313,088	$ 469,632

Answer 14

To determine

Concept Introduction:

Straight line method of depreciation:

This is one of the methods to calculate the depreciation on assets. Under this method the depreciable value of asset it divided equally for each year f its estimated life. The formula to calculate the deprecation under straight line method is as follows:

Annual Straight line depreciation = (Cost− Salvage Value)Estimated life in years

Requirement-1:

To Calculate:

The Net Income for each year using the MCRS Method

Year Net income
20Y2 $ 222,000
20Y3 $ 422,400
20Y4 $ 445,440
20Y5 $ 459,264
20Y6 $ 459,264
20Y7 $ 469,632

Answer 15

Expert Solution

Answer to Problem 7.3.2C

The Net Income for each year using the MCRS Method is as follows:

Answer 16

Expert Solution

Answer 17

Expert Solution

Answer 18

Expert Solution

Answer 19

Explanation of Solution

The Net Income for each year using the MCRS Method is calculated as follows:

Year	Income before Depreciation and Tax	Depreciation	Income before Tax	Income Tax	Net income
	A	B	C =A-B	*D=C40%**	E=C-D
20Y2	$ 400,000	$ 30,000	$ 370,000	$148,000	$ 222,000
20Y3	$ 800,000	$ 96,000	$ 704,000	$281,600	$ 422,400
20Y4	$ 800,000	$ 57,600	$ 742,400	$296,960	$ 445,440
20Y5	$ 800,000	$ 34,560	$ 765,440	$306,176	$ 459,264
20Y6	$ 800,000	$ 34,560	$ 765,440	$306,176	$ 459,264
20Y7	$ 800,000	$ 17,280	$ 782,720	$313,088	$ 469,632

Answer 20

Ch. 7 - Which of the following expenditures incurred in...Ch. 7 - What is the amount of depreciation, using the...Ch. 7 - An example of an accelerated depreciation method...Ch. 7 - Prob. 4SEQ Ch. 7 - Prob. 5SEQ Ch. 7 - Which of the following qualities are...Ch. 7 - Prob. 2CDQ Ch. 7 - Prob. 3CDQ Ch. 7 - Prob. 4CDQ Ch. 7 - Are the amounts at which fixed assets are reported...

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Answer to Problem 7.3.2C

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Answer to Problem 7.3.2C

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