Question
In: Accounting
On 1 January 2010, the CB Company purchased for $18000, new vehicle. The delivery cost was...
On 1 January 2010, the CB Company purchased for $18000, new vehicle. The delivery cost was a $2000. CB estimated the vehicle will have a residual value of $2000 at the end of its useful life of 6 years. CB Company estimated the vehicle could drive 180,000 km. The vehicle was driven 10,000 km during the year ending at 30 June 2010; 20000 km in the year ending 30 June 2011; 5000 km in the year ending 30 June 2012.
Required: A) Prepare journal entries to record the depreciation for the first 3 years( assume straight line method is used)
B) Prepare the journal entry to record the sale of the vehicle for $3500 on 30 June 2012 using the reducing balance method.
C) Assuming straight line method was used, CB ltd sold the vehicle after one year for $18000. Record the transaction.
Solutions
ekkarill92 answered 1 year agoRelated Solutions
ABC Delivery Company purchased a new delivery truck on January 1 with an original cost of...
ABC Delivery Company purchased a new delivery truck on January 1
with an original cost of $50,000. The company estimates it will use
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the first year, the truck was driven 15,000 miles. What is the
depreciation for the first year using the
DoubleDeclining Balance
method?
$10,000
$18,000
$7,500
$20,000
$6,750
$9,000
A company purchased a new delivery van at a cost of $60,000 on July 1. The...
A
company purchased a new delivery van at a cost of $60,000 on July
1. The delivery van is estimated to have a useful life of 6 years
and a salvage value of $4800. The company uses the straight line
method of depreciation. How much depreciation expense will be
recorded for the van during the first year ended December 31?
a. $5,000
b. $6,480
c. $4,600
d. $9,200
e. $5,600
On January 1, 2018, the Excel Delivery Company purchased a delivery van for $52,000. At the...
On January 1, 2018, the Excel Delivery Company purchased a
delivery van for $52,000. At the end of its five-year service life,
it is estimated that the van will be worth $4,000. During the
five-year period, the company expects to drive the van 150,000
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Required:
Calculate annual depreciation for the five-year life of the van
using each of the following methods.
1. Straight line.
2. Sum-of-the-years’-digits.
3. Double-declining balance.
4. Units of production using miles driven as a
measure...
On January 1, 2021, the Excel Delivery Company purchased a delivery van for $46,000. At the...
On January 1, 2021, the Excel Delivery Company purchased a
delivery van for $46,000. At the end of its five-year service life,
it is estimated that the van will be worth $4,000. During the
five-year period, the company expects to drive the van 165,000
miles.
Required:
Calculate annual depreciation for the five-year life of the van
using each of the following methods.
rev: 05_15_2019_QC_CS-168776, 11_22_2019_QC_CS-191707
Exercise 11-1 (Algo) Part 1
1. Straight line.
2. Double-declining balance. (Round
your answers to...
On January 1, 2018, the Excel Delivery Company purchased a delivery van for $57,000. At the...
On January 1, 2018, the Excel Delivery Company purchased a
delivery van for $57,000. At the end of its five-year service life,
it is estimated that the van will be worth $5,400. During the
five-year period, the company expects to drive the van 172,000
miles.
Required:
Calculate annual depreciation for the five-year life of the van
using each of the following methods.
1. Straight line.
2. Sum-of-the-years’-digits.
3. Double-declining balance.
4. Units of production using miles driven as a
measure...
KLM Ltd purchased new equipment on 1st January 2010, at a cost of $420 000 net...
KLM Ltd purchased new equipment on 1st January 2010, at a cost
of $420 000 net of GST. The company estimated that the equipment
had a useful life of 5 years and a residual value of $45 000.
Required Assuming a financial year ending 30th June, calculate the
amount of depreciation expense for each year ending 30th June 2010
through to 30th June 2015, with each of the following methods: (a)
straight line 2 marks (b) sum-of-years-digits 4 marks (c)...
On January 1, 2010, the Felix Company purchased a machine to use in the manufacture of...
On January 1, 2010, the Felix Company purchased a machine to use
in the manufacture of its product. The invoice cost of the machine
was $260,000. At the time of acquisition, the machine had an
original estimated useful life of 10 years and an estimated salvage
value of $20,000. Annual depreciation was recorded at $24,000 per
year. The machine was depreciated using the straight-line method.
On August 1, 2015, Felix exchanged the old machine for a newer
model. The new...
On January 1, 2010, the Felix Company purchased a machine to use in the manufacture of...
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in the manufacture of its product. The invoice cost of the machine
was $260,000. At the time of acquisition, the machine had an
original estimated useful life of 10 years and an estimated salvage
value of $20,000. Annual depreciation was recorded at $24,000 per
year. The machine was depreciated using the straight-line
method.
On August 1, 2015, Felix exchanged the old machine for a newer
model. The new...
Company recently purchased a new delivery truck. The new truck cost $22,500, and it is expected...
Company recently purchased a new delivery truck. The new truck
cost $22,500, and it is expected to generate net after-tax
operating cash flows, including depreciation, of $6,250 per year.
The truck has a 5-year expected life. The expected salvage values
after tax adjustments for the truck are given below. The company's
cost of capital is 12.5 percent.
Year/ Annual Operating Cash Flow/ Salvage Value
0/ $22,500/ $22,500
1/ 6,250/ 17,500
2/ 6,250/ 14,000
3/ 6,250/ 11,000
4/ 6,250/ 5,000
5/...
On January 1, 2018, On Time Delivery Service purchased a truck at a cost of $75,000....
On
January
1,
2018,
On Time
Delivery Service purchased a truck at a cost of
$75,000.
Before placing the truck in service,
On Time
spent
$2,200
painting it,
$1,700
replacing tires, and
$9,100
overhauling the engine. The truck should remain in service for
five years and have a residual value of
$10,000.
The truck's annual mileage is expected to be
27,000
miles in each of the first four years and
12,000
miles in the fifth
year—120,000
miles in total. In...
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