Question

In: Accounting

XYZ Industries purchased a new asset on March 31, 2020. The cost of the asset was...

XYZ Industries purchased a new asset on March 31, 2020. The cost of the asset was 140,000, with an estimated useful life of 8 years, and a salvage value of $15,000. XYZ uses the sum-of-the-years-digits method to depreciate the asset.

What is the book value of the asset on December 31, 2022?

67,709

72,291

None of the other answer choices is correct.

118,299

67,083

65,973

72,917

21,701

74,027

Solutions

Expert Solution

ekkarill92 answered 2 years ago
Next > < Previous

Related Solutions

Nash Corporation purchased an asset at a cost of $40,000 on March 1, 2020. The asset...
Nash Corporation purchased an asset at a cost of $40,000 on March 1, 2020. The asset has a useful life of 8 years and a salvage value of $3,200. For tax purposes, the MACRS class life is 5 years. MACRS Depreciation Rates by Class of Property Recovery Year 3-year   (200% DB) 5-year (200% DB) 7-year (200% DB) 10-year (200% DB) 15-year (150% DB) 20-year (150% DB) 1         33.33      20.00      14.29      10.00      5.00      3.750      2         44.45      32.00      24.29      18.00      9.50      7.219     ...
3. EASTDALE INDUSTRIES INC. STATEMENT OF INCOME FOR THE YEAR ENDED MARCH 31, 2020 ​​​​​​​​   2020   ​​  ...
3. EASTDALE INDUSTRIES INC. STATEMENT OF INCOME FOR THE YEAR ENDED MARCH 31, 2020 ​​​​​​​​   2020   ​​   2019    Sales revenue​​​​​​$1,095,000​​$750,000 Cost of goods sold​​​​​​     635,100​​  435,000 Gross profit​​​​​​​     459,900​​  315,000 Expenses   Depreciation​​​​​​   29,520​​   24,000 Office supplies​​​​​​   2,200​​   1,600 Salaries and benefits​​​​​   112,850​​  102,500 Rent​​​​​​​​   18,000​​   18,000   Utilities​​​​​​​       27,192​​ 20,200 ​​​​​​​​     189,762​​166,300 Operating income​​​​​​     270,138​​  148,700 Income tax expense​​​​​​     59,430​​   32,714​ Net income​​​​​​​$   210,708​​$ 115,986 Additional information: Unit sales for 2020 and 2019 were 8,760 and 6,000 units, respectively. Required: 5​a) For each cost in the above income statement,...
3. EASTDALE INDUSTRIES INC. STATEMENT OF INCOME FOR THE YEAR ENDED MARCH 31, 2020                             &nbs
3. EASTDALE INDUSTRIES INC. STATEMENT OF INCOME FOR THE YEAR ENDED MARCH 31, 2020                                                                                                    2020                            2019   Sales revenue                                                                      $1,095,000                $750,000 Cost of goods sold                                                                  635,100                  435,000 Gross profit                                                                               459,900                 315,000 Expenses    Depreciation                                                                             29,520                     24,000    Office supplies                                                                           2,200                       1,600    Salaries and benefits                                                            112,850                 102,500    Rent                                                                                           18,000                     18,000    Utilities                                                                                     27,192                    20,200                                                                                                    189,762                 166,300 Operating income                                                                     270,138                 148,700 Income...
3. EASTDALE INDUSTRIES INC. STATEMENT OF INCOME FOR THE YEAR ENDED MARCH 31, 2020                             &nbs
3. EASTDALE INDUSTRIES INC. STATEMENT OF INCOME FOR THE YEAR ENDED MARCH 31, 2020                                                                                                    2020                           2019   Sales revenue                                                                      $1,095,000                $750,000 Cost of goods sold                                                                    635,100                 435,000 Gross profit                                                                                459,900                  315,000 Expenses    Depreciation                                                                             29,520                    24,000    Office supplies                                                                           2,200                      1,600    Salaries and benefits                                                            112,850                  102,500    Rent                                                                                           18,000                    18,000    Utilities                                                                                       27,192                   20,200                                                                                                      189,762                 166,300 Operating income                                                                     270,138                  148,700 Income tax expense                                                                  59,430                     32,714       Net income                                                                            $   210,708                $ 115,986 Additional information: Unit sales for 2020 and 2019 were 8,760 and 6,000 units, respectively. Required: 5          a) For each cost in the above income statement, identify whether the cost is fixed, variable and mixed with respect to sales volume, and...
Juan acquires a new 5-year class asset on March 14, 2020, for $200,000. This is the...
Juan acquires a new 5-year class asset on March 14, 2020, for $200,000. This is the only asset Juan acquired during the year. He does not elect immediate expensing under § 179. He does not claim any available additional first-year depreciation. On July 15, 2021, Juan sells the asset. Click here to access depreciation table to use for this problem. a. Determine Juan's cost recovery for 2020. $ b. Determine Juan's cost recovery for 2021. $ On August 2, 2020,...
Brickell Corporation purchased a new machinery at the beginning of 2020 at a cost of $200,000....
Brickell Corporation purchased a new machinery at the beginning of 2020 at a cost of $200,000. The machinery is expected to have a useful life of 10 years and no residual value. The straight-line method of depreciation is used. Adverse economic conditions develop in 2022 that result in a significant decline in demand for Brickell’s products. At December 31, 2022 the company develops the following estimates related to the machinery: • Expected future cash flows: $150,000 • PV of expected...
On March 1, 2020, the XYZ Company acquired 40% of the voting stock of KLM Company...
On March 1, 2020, the XYZ Company acquired 40% of the voting stock of KLM Company for 6 million. The net worth of KLM book value is 10 million. The fair market value of the KLM assets and liabilities are equal except for a building with book value of 3 million has a fair value of 5 million. KLM reported net income of 2 million and made dividend distributions of 1 million during the year ending 12/31/2020 Assuming XYZ is...
On May 31, 2018, Javier Sanchez purchased and placed in service a new 7-year class asset...
On May 31, 2018, Javier Sanchez purchased and placed in service a new 7-year class asset costing $489,200 for use in his landscaping business, which he operates as a single member LLC (Sanchez Landscaping LLC). Rather than using bonus depreciation, Javier would like to use § 179 to expense $200,000 of this asset and then use regular MACRS to cost recover the remaining cost. During 2018, his business generated a net income of $587,040 before any § 179 immediate expense...
Sunrise Development Industries purchased a depreciable asset for $50 000 on 1 July 2016. The asset...
Sunrise Development Industries purchased a depreciable asset for $50 000 on 1 July 2016. The asset has a five-year useful life and a $10 000 estimated residual value. The company will use the straight-line method of depreciation for book purposes. However, Sunrise will use the reducing-balance method for tax purposes. Assume a tax rate of 30 per cent. Prepare depreciation schedules using the straight-line and reducing-balance methods (at 1.5 times the straight-line rate) of depreciation for the useful life of...
Hazel purchased a new business asset (five-year property) on November 30, 2017, at a cost of...
Hazel purchased a new business asset (five-year property) on November 30, 2017, at a cost of $100,000. This was the only asset acquired by Hazel during 2017. On January 7, 2018, Hazel place the asset in service. She did not elect to expense any of the asset cost under 179, nor did she elect straight-line cost recovery. On October 25, 2019, Hazel sold the asset. Determine the cost recovery for 2017, 2018 and 2019.
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT