Question

In: Accounting

11. Warren has equipment with cost of $22,000 and accumulated depreciation of $16,000. If Warren sells...

11. Warren has equipment with cost of $22,000 and accumulated depreciation of $16,000. If Warren sells the equipment for $7,000, what is the gain or loss?

A. gain of $7,000

b. loss of $1,000

c. gain of $13,000

d. gain of $1,000

12.How are partners compensated in a partnership?

A. each partner receives a cash payment on 12/31

b. each partner gets a salary paid in cash

c. each partner's capital receives a portion of the net income or loss in closing

d. interest expense is debited, and each partner receives the interest in cash

13. How are assets contributed by the partners valued in the partnership?

A. valued at original cost

b. valued at original cost minus accumulated depreciation

c. valued at fair market value

d. valued at an amount specified by the contributing partner

14.Conner contributed $15,000 cash to the AB partnership and received a $20,000 capital interest. Who received the bonus in this case?

A. the other partners of AB partnership

b. there was no bonus

c. Conner received the bonus

d. none of these is correct

15.Which of the following depreciation methods is accelerated?

A. straight line

b. units of activity

c. double declining balance

e. all of these are accelerated

Expert Solution

11:- Gain on sale of equipment = Sales Proceed - Book value

=$7000 - ($22000-$16000)

=$ 1000 gain.

12:-Option (c) "each partner's capital receives a portion of the net income or loss in closing" is Correct.

explantion:- After adjustment of operating income, interest to partner ,salary allowance etc ,Balanced income transferred to partner's capital accounts in their profit sharing ratio.

Others options:- No such payment given in option made in cash.

13:- Option (c)"valued at fair market value " is Correct.

14:- Option (b)" there was no bonus " is Correct.

New Partner getting interest capital more than it's contributed amount therefore partnership.have negative goodwill of $5000($15000-$20000)

15:- Option (c) "Double Declining Method" is Correct option.

Accelerated depreciation is any method of depreciation that allows greater deprecation expenses in the early years of the life of an asset and reduced by certain rate. Double declining method is accelerated depreciation method.

Straight line method charge equal depreciation in every year of useful life of assets.

unit of activity method charge depreciation on usefulness of assets

ekkarill92 answered 2 years ago

A truck that cost $18,000 and on which $16,000 of accumulated depreciation has been recorded was...

A truck that cost $18,000 and on which $16,000 of accumulated depreciation has been recorded was sold on January 1, the first day of the year. Assume the truck was sold for $2,500 cash. The entry to record the sale would include: a. a credit to the Accumulated Depreciation account for $16,000 b. a debit to Gain on Disposal of $500 c. a credit to the Truck account for $18,000 d. a credit to Cash for $2,500 Assume the truck...

11. A company used straight-line depreciation for an item of equipment that cost $16,000, had a...

11. A company used straight-line depreciation for an item of equipment that cost $16,000, had a salvage value of $2,000 and a five-year useful life. After depreciating the asset for three complete years, the salvage value was reduced to $500 but its total useful life remained the same. Determine the amount of depreciation to be charged against the equipment during each of the remaining years of its useful life: Select one: a. $7,100 b. $3,550 c. $2,000 d. $2,800 e....

Equipment that cost $594000 and has accumulated depreciation of $270000 is exchanged for equipment with a...

Equipment that cost $594000 and has accumulated depreciation of $270000 is exchanged for equipment with a fair value of $432000 and $108000 cash is received. The exchange lacked commercial substance. The new equipment should be recorded at: *Please show all work** The answer is $259,200 but not sure how to get it

Equipment that cost $398,100 and has accumulated depreciation of $318,900 is exchanged for equipment with a...

Equipment that cost $398,100 and has accumulated depreciation of $318,900 is exchanged for equipment with a fair value of $160,000 and $40,000 cash is received. The exchange lacked commercial substance. (a) Calculate the gain to be recognized from the exchange. Gain recognized $

Tamarisk Manufacturing has old equipment that cost $58,000. The equipment has accumulated depreciation of $27,200. Tamarisk...

Tamarisk Manufacturing has old equipment that cost $58,000. The equipment has accumulated depreciation of $27,200. Tamarisk has decided to sell the equipment. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) (a) What entry would Tamarisk make to record the sale of the equipment for $32,000 cash? (b) What entry would Tamarisk make to record the sale...

Equipment with an original cost of $51,422 and accumulated depreciation of $33,306 was sold at a...

Equipment with an original cost of $51,422 and accumulated depreciation of $33,306 was sold at a loss of $5,155. As a result of this transaction, cash would a.increase by $12,961 b.increase by $51,422 c.decrease by $5,155 d.decrease by $33,306

0n 12/31/2019, Sold Equipment that has a cost of $475,000; and accumulated depreciation of $225,000 The...

0n 12/31/2019, Sold Equipment that has a cost of $475,000; and accumulated depreciation of $225,000 The company received in exchange a Note which requires 6 annual payments of $50,000 The first payment occurs on 12/31/20. The stated rate of interest for the note is 6%. Required: A. Record the original transaction, for the seller. Record transaction through 12/31/22 B. Record the original transaction, for the purchaser. Record transaction through 12/31/22

12/31/2019 Sold Equipment that has an cost of $475,000; and accumulated depreciation of $225,000 The company...

12/31/2019 Sold Equipment that has an cost of $475,000; and accumulated depreciation of $225,000 The company received in exchange a Note which requires 6 annual payments of $50,000 The first payment occurs 12/31/19. The stated rate of interest for the note is 6%. Record the original transaction, for the seller. Record the transactions through 12/31/22

Historical cost of equipment is $27,000. Calculate depreciation expense, accumulated depreciation, and book value for two...

Historical cost of equipment is $27,000. Calculate depreciation expense, accumulated depreciation, and book value for two years. Useful life is 4 years.

A machine cost $1248000, has annual depreciation of $208000, and has accumulated depreciation of $988000 on...

A machine cost $1248000, has annual depreciation of $208000, and has accumulated depreciation of $988000 on December 31, 2020. On April 1, 2021, when the machine has a fair value of $286000, it is exchanged for a machine with a fair value of $1404000 and the proper amount of cash is paid. The exchange had commercial substance. The gain to be recorded on the exchange is $78000 $0 $156000 $52000