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devry acct305 week 3 homework




Question;Week Three - Homework Exercises E11-1, E11-6, E11-11;E11-14, and E11-20;Brief Execrise BE11-10, BE11-16;E11-1 On January 1;2013, the Excel Delivery Company purchased a delivery van for $33,000. At the;end of its five-year service life, it is estimated that the van will be worth;$3,000. During the five-year period, the company expects to drive the van;100,000 miles.;Required: Calculate;annual depreciation for the five-year life of the van using each of the;following methods. Round all computations to the nearest dollar.;E11-6 On April 29;2013, Quality Appliances purchased equipment for $260,000. The estimated;service life of the equipment is six years and the estimated residual value is;$20,000. Quality's fiscal year ends on December 31.;Required: Calculate;depreciation for 2013 and 2014 using each of the three methods listed. Quality;calculates partial year depreciation based on the number of months the asset is;in service. Round all computations to the nearest dollar.;1.;Straight line;2.;Sum-of-the-years' digits;3.;Double-declining balance;E11-11 On April 17;2013, the Loadstone Mining Company purchased the rights to a coal mine. The;purchase price plus additional costs necessary to prepare the mine for;extraction of the coal totaled $4,500,000. The company expects to extract;900,000 tons of coal during a four-year period. During 2013, 240,000 tons were;extracted and sold immediately.;Required: 1.;Calculate depletion for 2013;2.;Discuss the accounting treatment of the depletion calculated in requirement 1.;4,500,000/900,000;1. Calculate depletion for 2013;1,200,000;2. Discuss the accounting treatment of the depletion;calculated in requirement 1.;E11-14 Janes Company;provided the following information on intangible assets;a. A patent was;purcahsed from the Lou Company for $700,000 on January 1, 2011.;Janes estimated the remaining useful life of the patent to;be 10 years. The patent was;carried on Lou's accounting records at a net book value of;$350,000 when Lou sold it to;Janes.;b. During 2013;a franchise was purchased from the Rink Company for $500,000. The;contractual life of the franchise is 10 years and Janes;records a full year of amortization in;the year of purchase.;c. Janes;incurred research and development costs in 2013 as follows;Material and supplies $140,000;Personnel 180,000;Indirect cost 60,000;Total 380,000;d. Effective January;1, 2013, based on new events that have occurred, Janes estimates;that the remaining life of the patent purchased from Lou is;only five more years.;Required: 1.;Prepare the entries necessary for years 2011 through 2013 ro reflect the above;information.;2.;Prepare a schedule showing the intangible asset section of Janes's December 31;2013, balance sheet.;E11-20 For financial;reporting, Clinton Poultry Farms has used the declining-balance method of;depreciation for conveyor equipment acquired at the beginning of 2010 for;$2,560,000. Its useful life was estimated to be six years, with a $160,000;residual value. At the beginning of 2013, Clinton decides to change to the;straight-line method. The effect of this change on depreciation for each year;is as follows;($;in 000s);Year Straight Line Declining Balance Difference;2010 $400 $853;$453;2011 400 569 $169;2012 400 379 ($21);$1,200;$1,801 $601;Required: 1. Briefly describe the way Clinton should;report this accouting change in the 2010-2011 comparative financial statement;2. Prepare any 2011 journal entry related to the;change.;BE11-10 Collison;and Ryder Company (C&R) has been experiencing declining market conditions;for its sportswear division. Management decided to test the assets of the;division for possible impairment. The test revealed the following: book value;of division's assets, $26.5 million, fair value of division's assets, $21;million, sum of estimated future cash flows generated from the division's;assets, $28 million. What amount of impairment loss should C&R recognize?;BE11-16 Demmert;Manufacturing incurred the following expenditures during the current fiscal;year: annual maintenance on its machinery, $5,400, remodeling of offices;$22,000, rearrangement of the shipping and receiving area resulting in an;increase in productivity, $35,000, addition of a security system to the;manufacturing facility, $25,000. How should Demmert account for each of these;expenditures?


Paper#38680 | Written in 18-Jul-2015

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