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Financial Accounting_Depreciation Accounting

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Question;Financial Accounting;1. On September 30 of the current year, a;company acquired and placed in service a machine at a cost of $700,000. It has;been estimated that the machine has a service life of five years and a salvage;value of $40,000. Using the double-declining-balance method of depreciation;prepare a schedule showing depreciation amounts for the current year and the;next 4 years (round answers to the nearest dollar). The company closes its;books on December 31 of each year.;Answer;Year;Depreciation for the Period;End of Period;Beginning of Period Book Value;Depreciation Rate;Depreciation Expense;Accumulated Depreciation;Book Value;1;2;3;4;5;6;2. A company purchased land with a;building for a total cost of $2,570,000 ($500,000 paid in cash and the balance;on a long-term note). It was estimated that the land and building had market;values of $900,000 and $2,100,000, respectively.;Determine the cost to be apportioned to;the land and to the building and prepare the journal entry to record the;acquisition.;Answer;Asset Appraised Value Percent of Total Apportioned Cost;Land;Building;Total;Land..............................;Building..........................;Cash..........................;Long-Term;Note Payable.;3. On January 1, a machine costing;$260,000 with a 4-year life and an estimated $5,000 salvage value was;purchased. It was also estimated that the machine would produce 500,000 units;during its life. The actual units produced during its first year of operation;were 110,000. Determine the amount of depreciation expense for the first year;under each of the following assumptions;1. The company uses the straight-line;method of depreciation.;2. The company uses the;units-of-production method of depreciation.;3. The company uses the;double-declining-balance method of depreciation.;4. A company purchased a truck on October;1 of the current year at a cost of $40,000. The truck is expected to last six;years and has a salvage value of $2,200. The company's annual accounting period;ends on December 31.;1.;What is the depreciation expense for the current year, assuming the;straight-line method is used?;2. What is the depreciation expense for the;current year, assuming the double-declining-balance method is used?;5. On July 1 of the current year, a;company purchased and placed in service a machine with a cost of $240,000. The;company estimated the machine's useful life to be four years or 60,000 units of;output with an estimated salvage value of $60,000. During the current year;15,000 units were produced.;Prepare the necessary December 31;adjusting journal entry to record depreciation for the current year assuming;the company uses;a. The straight-line method of;depreciation;b. The units-of-production method of depreciation;c. The double-declining balance method of;depreciation;Answer;a.;Depreciation Expense?Machinery................................;Accumulated Depreciation?Machinery.......;b.;Depreciation Expense?Machinery.....................;Accumulated Depreciation?Machinery;c.;Depreciation Expense?Machinery.....................;Accumulated;Depreciation?Machinery

 

Paper#38257 | Written in 18-Jul-2015

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