Corporate Financial Accounting
14th Edition
ISBN: 9781305653535
Author: Carl Warren, James M. Reeve, Jonathan Duchac
Publisher: Cengage Learning
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Chapter 9, Problem 9.21EX
A.
To determine
Fixed Assets: It refers to the long-term assets having a useful life of more than a year which is, acquired by a company to be used in its business activities, for generating revenue. Examples of fixed assets are Plant, Property, Equipment, Land, and Buildings.
To compute: the book value of the fixed assets for the current year and the preceding year.
B.
To determine
To explain: whether it is normally expected that Company A’s book value of fixed assets would increase or decrease during the year.
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Book Value of Fixed Assets
Cannington, Inc., designs, manufactures, and markets personal computers and related software. The following information was taken from a
recent annual report of Cannington:
Property, Plant, and Equipment (in millions):
Preceding Year
$291,415
376,830
457,220
(532,586)
Current Year
Land and buildings
$502,440
Machinery, equipment, and internal-use software
477,318
Other fixed assets related to leases
607,952
Accumulated depreciation and amortization
(638,099)
a. Compute the book value of the fixed assets for the current year and the preceding year.
Current year book value
Preceding year book value i
A comparison of the book values of the current and preceding years indicates that they i
and accumulated depreciation reveals that Cannington purchased
additional depreciation expense of $
b. Would you normally expect the book value of fixed assets to increase or decrease during the year?
A comparison of the total cost
million of additional fixed assets, which was…
Book Value of Fixed Assets
Cannington, Inc., designs, manufactures, and markets personal computers and related software. The following information was taken from a recent annual report of Cannington industries:
Property, Plant, and Equipment (in millions):
Current Year
Preceding Year
Land and buildings
$519,320
$301,206
Machinery, equipment, and internal-use software
493,354
389,490
Office furniture and equipment
77,898
67,512
Other fixed assets related to leases
628,377
472,581
Accumulated depreciation and amortization
(659,536)
(550,479)
a. Compute the book value of the fixed assets for the current year and the preceding year.
Current year book value
Preceding year book value
b. Would you normally expect the book value of fixed assets to increase or decrease during the year?
9
Chapter 9 Solutions
Corporate Financial Accounting
Ch. 9 - ONeil Office Supplies has a fleet of automobiles...Ch. 9 - Prob. 2DQCh. 9 - Prob. 3DQCh. 9 - Distinguish between the accounting for capital...Ch. 9 - Immediately after a used truck is acquired, a new...Ch. 9 - Keyser Company purchased a machine that has a...Ch. 9 - Is it necessary for a business to use the same...Ch. 9 - A. Under what conditions is the use of an...Ch. 9 - For some of the fixed assets of a business, the...Ch. 9 - Prob. 10DQ
Ch. 9 - Straight-line depreciation A building acquired at...Ch. 9 - Units-of-activity depreciation A truck acquired at...Ch. 9 - Double-declining-balance depreciation A building...Ch. 9 - Revision of depreciation Equipment with a cost of...Ch. 9 - Capital and revenue expenditures On February 14,...Ch. 9 - Sale of equipment Equipment was acquired at the...Ch. 9 - Prob. 9.7BECh. 9 - Prob. 9.8BECh. 9 - Costs of acquiring fixed assets Melinda Staffers...Ch. 9 - Prob. 9.2EXCh. 9 - Prob. 9.3EXCh. 9 - Prob. 9.4EXCh. 9 - Straight-line depreciation rates Convert each of...Ch. 9 - Straight-line depreciation A refrigerator used by...Ch. 9 - Depreciation by units-of-activity method A...Ch. 9 - Depreciation by units-of-activity method Prior to...Ch. 9 - Depreciation by two methods A Kubota tractor...Ch. 9 - Depreciation by two methods A storage tank...Ch. 9 - Partial-year depreciation Equipment acquired at a...Ch. 9 - Prob. 9.12EXCh. 9 - Capital and revenue expenditures Warner Freight...Ch. 9 - Prob. 9.14EXCh. 9 - Capital and revenue expenditures Quality Move...Ch. 9 - Capital expenditure and depreciation Willow Creek...Ch. 9 - Entries for sale of fixed asset Equipment acquired...Ch. 9 - Disposal of fixed asset Equipment acquired on...Ch. 9 - Prob. 9.19EXCh. 9 - Amortization entries Kleen Company acquired patent...Ch. 9 - Prob. 9.21EXCh. 9 - Balance sheet presentation List the errors you...Ch. 9 - Asset traded for similar asset A printing press...Ch. 9 - Prob. 9.24EXCh. 9 - Entries for trade of fixed asset On July 1, Twin...Ch. 9 - Entries for trade of fixed asset On October 1,...Ch. 9 - Prob. 9.1APRCh. 9 - Comparing three depreciation methods Dexter...Ch. 9 - Depreciation by three methods; partial years...Ch. 9 - Depreciation by two methods; sale of fixed asset...Ch. 9 - Prob. 9.5APRCh. 9 - Amortization and depletion entries Data related to...Ch. 9 - Allocating payments and receipts to fixed asset...Ch. 9 - Comparing three depreciation methods Waylander...Ch. 9 - Depreciation by three methods; partial years...Ch. 9 - Depreciation by two methods; sale of fixed asset...Ch. 9 - Transactions for fixed assets, including sale The...Ch. 9 - Amortization and depletion entries Data related to...Ch. 9 - Continuing Company AnalysisAmazon: Fixed asset...Ch. 9 - Prob. 9.2ADMCh. 9 - Prob. 9.3ADMCh. 9 - Comcast, Google, and Walmart: Fixed asset turnover...Ch. 9 - Prob. 9.1TIFCh. 9 - Communication Godwin Co. owns three delivery...
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