Question
In: Accounting
40. What was the balance in Accumulated Depreciation on December 31, 20x2 if Max company used the S/L method?
|
On July 1, 20x1, Max company acquired equipment for $1,500,000. Its estimated life was 5 years or 40,000 hours. The residual value was estimated as $100,000. |
40. What was the balance in Accumulated Depreciation on December 31, 20x2 if Max company used the S/L method?
A. $140,000
B. $280,000
C. $420,000
D. $560,000
|
Your answer (A, B, C, or D) |
Show your calculation in detail.
41. What was the balance in Accumulated Depreciation on December 31, 20x2 if Max company used the DDB method?
A. $300,000
B. $600,000
C. $780,000
D. None of the above
|
Your answer (A, B, C, or D) |
Show your calculation in detail.
Solutions
Expert Solution
Answer:
40.
Option (B) $280,000
Based on the information available in the question, we can summarize as follows:-
Cost of the equipment - $1,500,000
Estimated Life - 5 years.
Residual Value - $100,000
Depreciation per year under straight line depreciation method :- (
=Cost of the equipment - Salvage/Residule value)/Estimated life of the asset
=($1,500,000 - $100,000)/5 years
=($1,400,000)/5 years
Straight Line Depreciation = $280,000 per year
Depreciation for 2021 (July 01 - December 30) = $280,000 * 6/12 = $140,000 A
Depreciation for 2022 = $280,000 B
A + B = $320,000
Accumulated Depreciation as of 12/31/2022 = $320,000
41.
Option (C) $780,000
Working:
Straight-lime method (SLM) depreciation rate = 1 / 5 = 0.20
So, Double Declining Balance (DDB) depreciation rate = 0.2 x 2 = 0.40 or 40%
(a) DDB depreciation schedule
|
Year |
Cost ($) |
Annual Depreciation ($) |
Accumulated Depreciation ($) |
Balance ($) |
|
2021 |
1,500,000 |
300,000 (1,500,000*40%*6/12) |
300,000 |
1,200,000 |
|
2022 |
1,200,000 |
480,000 (1,200,000*40%) |
780,000 (300,000+480,000) |
720,000 |
ekkarill92 answered 2 years agoRelated Solutions
The partial trial balance for Marianna Co. as at December 31, 20x2 is as follows: 20x2...
The partial trial balance for Marianna Co. as at December 31,
20x2 is as follows:
20x2 20x1
Common shares $17,045,917 $15,500,000
Contributed Surplus – Stock Options 120,000 300,000
Retained earnings 4,736,776 4,650,000
There are 52,000 stock options which vested on December 31, 20x1
at an exercise price
of $31 per share. The exercise period for this plan started on
Jan 1, 20x2 and ends on
December 31, 20x3.
There were 650,000 shares outstanding at the beginning of the
year. The...
Sanford Company The Sanford Company had the following balance sheet as of December 31, 20x2. The...
Sanford Company
The Sanford Company had the following balance sheet as of
December 31, 20x2. The transactions for the first three months of
20x3 are also presented along with other information about specific
accounts.
Sanford Company
Balance Sheet
December 31, 20x2
ASSETS
LIABILITIES
Cash
$ 57,000
Accounts Payable
$ 34,000
Marketable Securities
8,000
Wages Payable
11,500
Accounts Receivable
73,000
Taxes Payable
8,000
Uncollectible Accounts
-2,000
Short-Term Notes Payable
12,000
Inventory
84,000
Interest Payable
500
Supplies
9,000
Unearned Revenue
13,000
Prepaid...
Sanford Company The Sanford Company had the following balance sheet as of December 31, 20x2. The...
Sanford Company
The Sanford Company had the following balance sheet as of
December 31, 20x2. The transactions for the first three months of
20x3 are also presented along with other information about specific
accounts.
Sanford Company
Balance Sheet
December 31, 20x2
ASSETS
LIABILITIES
Cash $ 57,000 Accounts
Payable $ 34,000
Marketable Securities 8,000
Wages Payable 11,500
Accounts Receivable 73,000
Taxes Payable 8,000
Uncollectible Accounts -2,000
Short-Term Notes Payable
12,000
Inventory 84,000
Interest Payable ...
Sanford Company The Sanford Company had the following balance sheet as of December 31, 20x2. The...
Sanford Company
The Sanford Company had the following balance sheet as of
December 31, 20x2. The transactions for the first three months of
20x3 are also presented along with other information about specific
accounts.
Sanford Company
Balance Sheet
December 31, 20x2
ASSETS
LIABILITIES
Cash
$ 57,000
Accounts Payable
$ 34,000
Marketable Securities
8,000
Wages Payable
11,500
Accounts Receivable
73,000
Taxes Payable
8,000
Uncollectible Accounts
-2,000
Short-Term Notes Payable
12,000
Inventory
84,000
Interest Payable
500
Supplies
9,000
Unearned Revenue
13,000
Prepaid...
Sanford Company The Sanford Company had the following balance sheet as of December 31, 20x2. The...
Sanford Company
The Sanford Company had the following balance sheet as of
December 31, 20x2. The transactions for the first three months of
20x3 are also presented along with other information about specific
accounts.
Sanford Company
Balance Sheet
December 31, 20x2
ASSETS
LIABILITIES
Cash
$ 57,000
Accounts Payable
$ 34,000
Marketable Securities
8,000
Wages Payable
11,500
Accounts Receivable
73,000
Taxes Payable
8,000
Uncollectible Accounts
-2,000
Short-Term Notes Payable
12,000
Inventory
84,000
Interest Payable
500
Supplies
9,000
Unearned Revenue
13,000
Prepaid...
Dec 31 Supplies Expenses 45 Supplies 45 Dec 31 Depreciation Expense 40 Accumulated Depreciation - Equipment...
Dec 31
Supplies Expenses
45
Supplies
45
Dec 31
Depreciation Expense
40
Accumulated Depreciation - Equipment
40
Dec 31
Amortization Expense
25
Website
25
Dec 31
Interest expense
23
Interest Payable
23
Dec 31
Insurance expense
100
prepaid expense
100
Dec 31
accounts receivable
450
service revenue
450
Dec 31
supplies expense
1030
supplies
1030
Dec 31
utilities expense
75
accounts payable
75
Dec 31
salaries and wages expense
56
salaries and wages payable
56
Dec 31
unearned service revenue...
Lake Company reported the following summarized balance sheet data as of December 31, 20X2: Cash $...
Lake Company reported the following summarized balance sheet
data as of December 31, 20X2:
Cash
$
38,000
Accounts Payable
$
49,000
Accounts Receivable
87,000
Common Stock
130,000
Inventory
96,000
Retained Earnings
207,000
Buildings & Equipment
285,000
Less: Accumulated
Depreciation
(120,000)
Total Assets
$
386,000
Total Liabilities & Equities
$
386,000
Lake issues 4,400 additional shares of its $10 par value stock
to its shareholders as a stock dividend on April 20, 20X3. The
market price of Lake’s shares at the...
The 31 December 20X2 year-end trial balance for Dynamics Ltd., a private company, showed the following...
The 31 December 20X2 year-end trial balance for Dynamics Ltd., a
private company, showed the following account balances:
Dr./(Cr.)
Retained earnings, 31 December 20X1
$ (8,300,000)
Sales revenue
(9,300,000)
Dividend income from investments
(69,000)
Cost of sales
4,950,000
Impairment on discontinued plant assets,
held-for-sale (before tax)
790,000
General, selling, and administrative expenses
1,845,000
Interest expense
104,000
Reduction in prior years’ earnings due to change in
accounting policy, cumulative to 31 December 20X1 (before tax)
400,000...
Keisler Corporation reports: 2016 2017 Equipment, December 31 $10,000 $20,000 Accumulated depreciation, December 31 ($5,000) ($7,000)...
Keisler Corporation reports: 2016 2017 Equipment, December 31
$10,000 $20,000 Accumulated depreciation, December 31 ($5,000)
($7,000) Depreciation Expense of Equipment $5,000 Gain on disposal
of Equipment $2,000 During 2017, Keisler sold equipment which has
original cost of $5,000. Additional purchase of equipment in 2017
was paid in cash. No other investing activities are reported in
2017. What is cashflows by investing activities in 2017? Group of
answer choices
$(10,000).
$4,000.
$(8,000).
$(11,000).
The trial balance of Padma Ltd at 31 December 20X2 was as follows: Sales revenue $1,600,650...
The trial balance of Padma Ltd at 31 December 20X2 was as
follows:
Sales revenue
$1,600,650
Interest income
35,450
Loss on sale of plant
7,600
Fair value loss on equity investments in other companies (to be
taken to profit or loss)
50,670
Dividend revenue
6,500
Cost of sales
850,670
Finance expenses
35,600
Selling and distribution expenses
90,270
Administrative expenses
336,790
Additional information
• A loss of $67,870 was recognised on the revaluation of land
during 20X2.
• Padma Ltd uses...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- Assume that attributes with the same name in different relations represent the same domain and that...
- JAVA: Use existing Java Stack class to solve the "Balancing Symbols" problem. The symbols are (),...
- K-NN and Perceptron theory question If we don’t care about the size of the TRAINING SET...
- Make a C program that simulates time-sharing in the operating system. Please follow the instructions provided:...
- What are some current challenges faced by food companies in reducing food waste?
- Arthur buys $2,200.00 worth of stock. Six months later, the value of the stock has risen...
- The Following table is based on a time study for a metal working operation Obs (minutes...
ADVERTISEMENT