Question
In: Accounting
Stacey Ltd purchased a new machine on 1 September 2019 at a cost of $206,100 (excluding...
| Stacey Ltd purchased a new machine on 1 September 2019 at a cost of $206,100 (excluding GST). | ||||||
| The entity estimated that the machine has a residual value of $29,700 (excluding GST). | ||||||
| The machine is expected to be used for 36,000 working hours during its 8 year life. | ||||||
| Assume a 31 December year-end. |
Required
(a) Calculate the depreciation expense using the straight-line method for 2019 and 2020. (b) Calculate the depreciation expense using the diminishing-balance method and a depreciation rate of 25% for 2019 and 2020. (c) Calculate the depreciation expense using the units-of-production method for 2019, assuming the machine usage was 1,820 hours. (d) On 31 December 2020 the company discarded a delivery truck that was purchased on 1 January 2016 for $24,200 cash (including GST of 10%) and was depreciated on a straight line basis with a useful life of 6 years and a residual value of $2200 (excluding GST). What was the profit or loss on the scrapping of the truck?
Solutions
ekkarill92 answered 1 year agoRelated Solutions
Stacey Ltd purchased a new machine on 1 September 2019 at a cost of $243,000 (excluding...
Stacey Ltd purchased a new machine on 1 September
2019 at a cost of $243,000 (excluding GST).
The entity estimated that the machine has a
residual value of $28,800 (excluding GST).
The machine is expected to be used for 42,000
working hours during its 10 year life
Assume a 31 December
year-end.
Required
(a) Calculate the depreciation expense using the straight-line method for 2019 and 2020.
(b) Calculate the depreciation expense using the diminishing-balance method and a depreciation rate of...
Stacey Ltd purchased a new machine on 1 September 2019 at a cost of $206,100 (excluding...
Stacey Ltd purchased a new machine on 1 September 2019 at a cost
of $206,100 (excluding GST). The entity estimated that the machine
has a residual value of $29,700 (excluding GST). The machine is
expected to be used for 36,000 working hours during its 8 year
life. Assume a 31 December year-end. Required (a) Calculate the
depreciation expense using the straight-line method for 2019 and
2020. (b) Calculate the depreciation expense using the
diminishing-balance method and a depreciation rate of...
Stacey Ltd purchased a new machine on 1 September 2019 at a cost of $243,000 (excluding...
Stacey Ltd purchased a new machine on 1 September 2019 at a cost of
$243,000 (excluding GST).
The entity estimated that the machine has a residual value of
$28,800 (excluding GST).
The machine is expected to be used for 42,000 working hours
during its 10 year life
Assume a 31 December year-end.
Required
(a) Calculate the depreciation expense using the straight-line
method for 2019 and 2020.
(b) Calculate the depreciation expense using the
diminishing-balance method and a...
Stacey Ltd purchased a new machine on 1 September 2019 at a cost of $251,200 (excluding...
Stacey Ltd purchased a new machine on 1 September
2019 at a cost of $251,200 (excluding GST).
The entity estimated that the machine has a
residual value of $28,600 (excluding GST).
The machine is expected to be used for 42,000
working hours during its 10 year life
Assume a 31 December
year-end.
Required
(a) Calculate the depreciation expense using the straight-line method for 2019 and 2020.
(b) Calculate the depreciation expense using the diminishing-balance method and a depreciation rate...
1-Numo Company purchased a new machine on September 1, 2017, at a cost of $145,000. The...
1-Numo Company purchased a new machine on September 1, 2017, at
a cost of $145,000. The company estimated that the machine will
have a salvage value of $25,000. The machine is expected to be used
for 20,000 working hours during its 5-year life.
2-Numo Company purchased a new machine on January 1, 2017, at a
cost of $145,000. The company estimated that the machine will have
a salvage value of $25,000. The machine is expected to be used for
20,000...
Monty Corp. purchased a new machine on October 1, 2019, at a cost of $124,000. The...
Monty Corp. purchased a new machine on October 1, 2019, at a
cost of $124,000. The company estimated that the machine will have
a salvage value of $15,000. The machine is expected to be used for
10,000 working hours during its 4-year life.
Compute the depreciation expense under straight-line method for
2019. (Round answer to 0 decimal places, e.g.
2,125.)
2019
Depreciation expense
$
Compute the depreciation expense under units-of-activity for
2019, assuming machine usage was 1,860 hours. (Round...
1. Blue Spruce Corp. purchased a new machine on October 1, 2019, at a cost of...
1. Blue Spruce Corp. purchased a new machine on October 1, 2019,
at a cost of $134,000. The company estimated that the machine will
have a salvage value of $20,000. The machine is expected to be used
for 10,000 working hours during its 5-year life.
Compute the depreciation expense under straight-line method for
2019. (Round answer to 0 decimal places, e.g.
2,125.)
2019 Depreciation expense:
2. Yello Bus Lines uses the units-of-activity method in
depreciating its buses. One bus was...
PROBLEM 3 Depreciation Yara Company purchased a new machine on 1 September 2007, at a cost...
PROBLEM 3
Depreciation
Yara Company purchased a new machine on 1 September 2007, at a
cost of $180,000. The machine’s estimated useful life at the time
of the purchase was five years, and its residual value was $10,000.
Yara adopts the cost model as its accounting policy in subsequently
measuring its property, plant, and equipment.
Instructions
Prepare a complete depreciation schedule, beginning with
calendar year 2007, under each of the methods listed below (assume
that half-year convention is used):
Straight-line....
Mags Ltd. has purchased a new machine for a cost of $500,000. The machine has just...
Mags Ltd. has purchased a new machine for a cost of $500,000.
The machine has just been
installed and the cost of installation is $30,000. The internal
auditors have advised that the
cost of installation cannot be depreciated. The machine’s
suppliers have requested a 20%
deposit on installation with the remainder to be paid within six
months. The current
estimated before-tax net operating cash revenue for the coming
four years are $300,000 in
the first year, $320,000 in the second...
Maserati spa purchased a new machine for its assembly process on August 1, 2019. The cost...
Maserati spa purchased a new machine for its assembly process on
August 1, 2019. The cost of this machine was 150,000. The company
estimated that the machine would have a residual value of 24,000 at
the end of its life. It’s life is estimated at 5 years and it’s
working hours are estimated at 21,000 hours. Year end is December
31
Compute the depreciation expense under the following methods.
Each of the following should be considered unrelated.
A. Straight line...
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