Question

In: Accounting

part 1) A piece of equipment is purchased for $400,000 and has an estimated salvage value...

part 1)

A piece of equipment is purchased for $400,000 and has an estimated salvage value of $50,000 at the end of a five year recovery period. Using the sum of the years depreciation method, what is the book value in year 4?

Group of answer choices

$73,333

-$216,667

$120,000

$50,000

part 2)

A piece of equipment is purchased for $100,000 and has an estimated salvage value of $12,000 at the end of a seven year recovery period. Using the 200% declining balance depreciation method, what is the amount the equipment depreciated by (Dm) in year seven?

Group of answer choices

$4,174

$2,609

$1,281

$3,795

Expert Solution

1)

Correct Option : $73333

2)

Depreciation Rate = 1/7* 100*2 =28.57%

Correct Answer = $1281

ekkarill92 answered 1 year ago

A piece of equipment is purchased for $40,000 and has an estimated salvage value of $1,000...

A piece of equipment is purchased for $40,000 and has an estimated salvage value of $1,000 at the end of the recovery period, a recovery period is five years. Prepare a depreciation schedule for the piece of equipment using the straight-line method

1. A piece of equipment was purchased new at $35,000. The salvage value is $1500 after...

1. A piece of equipment was purchased new at $35,000. The salvage value is $1500 after its 8 year service life. Determine the depreciation and blue book value for the life of the asset, assuming: a) straight line depreciation b) MACRS (use 5 yr table) c) SOYD method d) DDB method

A piece of equipment having a negligible salvage and scrap value if estimated to have a...

A piece of equipment having a negligible salvage and scrap value if estimated to have a MACRS and straight line recovery period of 5 years. The original cost of ther equipment was $500,000. Determin the depreciation charge of the euipment for the second yeqr if straight line depreciation is used and the percentage of the original investment paid off in the first 2 years.

You just purchased a piece of equipment that cost $899,000, has a salvage value of $322,000,...

You just purchased a piece of equipment that cost $899,000, has a salvage value of $322,000, and a useful life of 11 years. How much depreciation can be taken each year using Straight Line Depreciation? How much depreciation can be taken each year using Double Declining Depreciation? How much depreciation can be taken each year using Sum of Years Depreciation? Which approach would potentially provide you with the biggest tax savings in year 11?

Bramble Company purchased equipment on January 1, 2019, for $79000 with an estimated salvage value of...

Bramble Company purchased equipment on January 1, 2019, for $79000 with an estimated salvage value of $19000 and estimated useful life of 8 years. On January 1, 2021, Bramble decided the equipment will last 12 years from the date of purchase. The salvage value is still estimated at $19000. Using the straight-line method the new annual depreciation will be: $4500. $5000. $6583. $16000. Waterway Sox Company had checks outstanding totaling $12000 on its June bank reconciliation. In July, Waterway Sox...

(b Stevenson Company purchased equipment for $250,000 on January 1, 2010. The estimated salvage value is...

(b Stevenson Company purchased equipment for $250,000 on January 1, 2010. The estimated salvage value is $50,000, and the estimated useful life is 5 years. The straight-line method is used for depreciation. On July 1, 2013 Stevenson sold the equipment for $100,000. The journal entry to record the sale of the equipment will include. (5 points) A. A debit to cash of $100,000, a credit to equipment of $250,000 B. A credit to accumulated depreciation of $140,000 C. A debit...

Faster Company purchased equipment in 2010 for $104,000 and estimated an $8,000 salvage value at the...

Faster Company purchased equipment in 2010 for $104,000 and estimated an $8,000 salvage value at the end of the equipment's 10-year useful life. At December 31, 2016, there was $67,200 in the Accumulated Depreciation account for this equipment using the straight-line method of depreciation. On March 31, 2017, the equipment was sold for $21,000. Prepare the appropriate journal entries to remove the equipment from the books of Faster Company on March 31, 2017. (b) Lewis Company sold equipment for $11,000....

[11] A piece of equipment was acquired for a cost of $400,000. It had an estimated...

[11] A piece of equipment was acquired for a cost of $400,000. It had an estimated useful life of 5 years. The estimated salvage value is $40,000. The company controller uses a double declining balance method of accelerated depreciation. The piece of equipment was purchased on Oct. 1, 2014. The company is generating projections for the next few years and has asked you to show him what depreciation expense, accumulated depreciation, and book value of this piece of equipment will...

. A dump truck is purchased for $110,000 and has an estimated salvage value of $10,000...

. A dump truck is purchased for $110,000 and has an estimated salvage value of $10,000 at the end of the recovery period. Prepare a depreciation schedule for the dump truck with a recovery period of five years using: a) the straight-line method b) the sum-of-the-years method c) the declining-balance method

An excavation company purchased a truck for $60,000 that has an estimated salvage value of $15,000...

An excavation company purchased a truck for $60,000 that has an estimated salvage value of $15,000 at the end of its 5-year useful life. Compute the second year depreciation, the cumulative depreciation at the end of the second year, and the book value at the end of the second yearusing: (a) Straight-line (SL) depreciation, (b) Sum-of-the-years’ digits (SOYD) depreciation, (c) Double declining balance (DDB) depreciation, and (d) MACRS depreciation. Please put each depreciation in the each box.