Question
In: Accounting
On Jan 3, 2017, Limestone Enterprises purchased equipment for $134,500. The equipment has a useful life...
On Jan 3, 2017, Limestone Enterprises purchased equipment for $134,500. The equipment has a useful life of five years or of 15,000 working hours and after the useful life it will have a residual value of $12,000. The machine was used for 1,400 hours in 2017, 2,100 hours in 2018; 3,700 hours in 2019.
Required:
1. Calculate the depreciation expense for 2017 and 2018 under each of the following methods:
i. Straight-line,
ii. Double diminishing-balance, and
iii. Units-of -production
2. Record the journal entry for depreciation expense for the year ended December 31, 2017 under the straight-line method.
Which method results in the lowest profit for the first two years? Why?Solutions
ekkarill92 answered 2 years agoRelated Solutions
On Jan 3, 2017, Limestone Enterprises purchased equipment for $139,200. The equipment has a useful life...
On Jan 3, 2017, Limestone Enterprises purchased equipment for
$139,200. The equipment has a useful life of four years or of
12,000 working hours and after the useful life it will have a
residual value of $14,000. The machine was used for 1,900 hours in
2017, 2,800 hours in 2018; 3,700 hours in 2019.
Required:
Calculate the depreciation expense for 2017 and 2018 under each
of the following methods:
Straight-line,
Double diminishing-balance, and
Units-of -production
Record the journal entry for...
On Jan 2, 2017, Sandstone Enterprises purchased equipment for $129,200. The equipment has a useful life...
On Jan 2, 2017, Sandstone Enterprises purchased equipment for
$129,200. The equipment has a useful life of four years or of
12,000 working hours and after the useful life it will have a
residual value of $14,000. The machine was used for 1,900 hours in
2017, 2,800 hours in 2018; 3,700 hours in 2019.
Required:
Calculate the depreciation expense for 2017 and 2018 under each
of the following methods:
Straight-line,
Double diminishing-balance, and
Units-of -production
Record the journal entry for...
On Jan 2, 2017, Sandstone Enterprises purchased equipment for $129,200. The equipment has a useful life...
On Jan 2, 2017, Sandstone Enterprises purchased equipment for
$129,200. The equipment has a useful life of four years or of
12,000 working hours and after the useful life it will have a
residual value of $14,000. The machine was used for 1,900 hours in
2017, 2,800 hours in 2018; 3,700 hours in 2019.
Required:
Calculate the depreciation expense for 2017 and 2018 under each
of the following methods:
Straight-line,
Double diminishing-balance, and
Units-of -production
Record the journal entry for...
On Jan 2, 2018, Sandstone Enterprises purchased equipment for $129,200. The equipment has a useful life...
On Jan 2, 2018, Sandstone Enterprises purchased equipment for
$129,200. The equipment has a useful life of four years or of
13,000 working hours and after the useful life it will have a
residual value of $13,500. The machine was used for 1,900 hours in
2018, 2,800 hours in 2019; 3,700 hours in 2020.
Required:
Calculate the depreciation expense for 2018 and 2019 under each
of the following methods:
Straight-line,
Double diminishing-balance, and
Units-of -production
Record the journal entry for...
Q12) A company has purchased an equipment costing $84,300. The equipment has a useful life of...
Q12) A company has purchased an equipment costing $84,300. The
equipment has a useful life of 3 years with a salvage value of
$34,100. CCA will be taken using a rate of 30.00%. The tax rate is
29.00%, while the discount rate is 9.00%. Assuming the company
takes all available CCA every year and there will be some assets
remaining in the CCA class after year 3, what is the EAC of this
equipment? 16,741 17,194 17,646 18,099 18,551
A Company purchased equipment on December 1, 2017 for $7,200 with a 2 years useful life....
A Company purchased equipment on December 1, 2017 for $7,200 with a
2 years useful life. On March 1, 2019, the company decided to
dispose the equipment. The equipment is depreciated under the
straight-line method
Find
:
Annual depreciation expense
Depreciation expense of the year 2017
Depreciation expense of the year 2018
Depreciation expense of the year 2019
Accumulated Depreciation at the disposal date
Book value at the disposal date: *
Assume that the equipment was sold for $2,100, what...
A Company purchased equipment on November 1, 2017 for $7,200 with a 2 years useful life....
A Company purchased equipment on November 1, 2017 for $7,200
with a 2 years useful life. On March 31, 2019, the company decided
to dispose the equipment. The equipment is depreciated under the
straight-line method.
Compute the equipment’s:
Annual depreciation expense: *
a-$1,200
b-$2,100
c-$3,600
d-$6,300
e-None of the above
Depreciation expense of the year 2017: *
a-$300
b-$600
c-$900
d-$1,200
e-None of the above
Depreciation expense of the year 2018: *
a-$300
b-$600
c-$900
d-$1,200
e-None of the above...
On July 1, 2017, Sparks Company purchased for $4,300,000 an equipment having an estimated useful life...
On July 1, 2017, Sparks Company purchased for $4,300,000 an
equipment having an estimated useful life of 5 years with an
estimated residual value of $200,000. Depreciation is taken for the
portion of the year the asset is used.
Instructions
(a) Complete the form below by determining the depreciation
expense and year-end book values for 2017and 2018 using the
1.
sum-of-the-years'-digits method.
2. double-declining
balance method.
Sum-of-the-Years'-Digits
Method
2017
2018
Equipment
$4,300,000
$4,300,000
Less: Accumulated
Depreciation ...
ABC purchased a machine on Jan 1, 2016 for $92788 with an estimated useful life of...
ABC purchased a machine on Jan 1, 2016 for $92788 with an
estimated useful life of 12 years and no salvage value ABC uses the
straight line depreciation method On December 31, 2018
technological changes suggest the machine may be impaired On
December 31, 2018 the machine is expected to generate net cash
flows of $6014 per year over its remaining life On December 31,
2018 the fair value of the machine is $45126.42 On Dec 31, 2018 the
carrying...
On August 3, Cinco Construction purchased special-purpose equipment at a cost of $7,092,800. The useful life...
On August 3, Cinco Construction purchased special-purpose
equipment at a cost of $7,092,800. The useful life of the equipment
was estimated to be eight years, with an estimated residual value
of $52,490. a. Compute the depreciation expense to be recognized
each calendar year for financial reporting purposes under the
straight-line depreciation method (half-year convention). b.
Compute the depreciation expense to be recognized each calendar
year for financial reporting purposes under the 200 percent
declining-balance method (half-year convention) with a switch...
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