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SUBDOMAIN 302.3 - FINANCIAL ACCOUNTING

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Question;SUBDOMAIN 302.3 - FINANCIAL ACCOUNTINGCompetency 302.3.4: Depreciation - The student can use various methods of depreciation.Objectives:302.3.4-01: Justify when to use a specific depreciation method.302.3.4-02: Calculate depreciation expense using the straight line method.302.3.4-03: Calculate depreciation expense using the declining balance method.302.3.4-04: Calculate depreciation expense using the units of output method.302.3.4-05: Calculate depreciation expense using the sum-of-the-years?-digits method.--------------------------------------------------------------------------------Given:Fan Company A has its assets, land, building, and equipment on its books.Task:A. Using the information provided in the Excel spreadsheet ?Financial Records for Depreciation? attached below, calculate the depreciation for Fan Company A?s building using the straight line method.B. Using the information provided on the Excel spreadsheet ?Financial Records for Depreciation? attached below, calculate the depreciation for Fan Company A?s equipment using the following methods:1. Double declining balance2. Units of output3. Sum-of-the-years?-digitsNote: For definitions of terms commonly used in the rubric, see the attached Rubric Terms.Note: When using sources to support ideas and elements in a paper or project, the submission MUST include APA formatted in-text citations with a corresponding reference list for any direct quotes or paraphrasing. It is not necessary to list sources that were consulted if they have not been quoted or paraphrased in the text of the paper or project.Note: No more than a combined total of 30% of a submission can be directly quoted or closely paraphrased from sources, even if cited correctly. For tips on using APA style, please refer to the APA Handout web link included in the APA Guidelines section.Financial Records for DepreciationAsset:LandCost:40,000Date inServiceDepreciationExpenseAsset:BuildingCost:430,000Date inServiceDepreciationExpenseDepreciation Method:Est. Useful Life:Expect Salvage:AccumulatedDepreciationDepreciation Method:Est. Useful Life:Expect Salvage:AccumulatedDepreciationBookValueStraight line3070,000BookValueDecember 31, Yr 2Year 3Year 4Year 5Year 6Asset:EquipmentCost:180,000Date inServiceDepreciationExpenseDepreciation Method:Est. Useful Life:Salvage:AccumulatedDepreciationDDB6 yrs30,000BookValue12/31/Year 5Year 6Year 7Purchased on December 31, Year 5. The asset has a 6 year life. Expected lifetime units 1,000,000.Year 6 production 82000, production in Year 7 is expected to be 91000Asset:EquipmentCost:180,000Date inServiceDepreciationExpenseDepreciation Method:Est. Useful Life:Salvage:AccumulatedDepreciationUnits6 yrs30,000BookValue12/31/Year 5Year 6Year 7Asset:Cost:Date inService12/31/Year 5Year 6Year 7Year 8Year 9Year 10Equipment180,000DepreciationExpenseDepreciation Method:Est. Useful Life:Salvage:AccumulatedDepreciationSum of Yrs Digits6 yrs30,000BookValue

 

Paper#43276 | Written in 18-Jul-2015

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