Kansas Enterprises purchased equipment for $75,500 on January 1, 2021. The equipment is expected to have a five-year life, with a residual value of $8,400 at the end of five years. Using the double-declining balance method, the book value at December 31, 2022, would be:
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Kansas Enterprises purchased equipment for $75,500 on January 1, 2021. The equipment is expected to have a five-year life, with a residual value of $8,400 at the end of five years.
Using the double-declining balance method, the book value at December 31, 2022, would be:
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- On August 1, 2019, Kern Company leased a machine to Day Company for a 6-year period requiring payments of 10,000 at the beginning of each year. The machine cost 40,000 and has a useful life of 8 years with no residual value. Kerns implicit interest rate is 10%, and present value factors are as follows: Present value for an annuity due of 1 at 10% for 6 periods4.791 Present value for an annuity due of 1 at 10% for 8 periods5.868 Kern appropriately recorded the lease as a sales-type lease. At the inception of the lease, the Lease Receivable account balance should be: a. 60,000 b. 58,680 c. 48,000 d. 47,910At the beginning of 2020, Holden Companys controller asked you to prepare correcting entries for the following three situations: 1. Machine X was purchased for 100,000 on January 1, 2015. Straight-line depreciation has been recorded for 5 years, and the Accumulated Depreciation account has a balance of 45,000. The estimated residual value remains at 10,000, but the service life is now estimated to be 1 year longer than originally estimated. 2. Machine Y was purchased for 40,000 on January 1, 2018. It had an estimated residual value of 4,000 and an estimated service life of 8 years. It has been depreciated under the sum-of-the-years-digits method for 2 years. Now, the company has decided to change to the straight-line method. 3. Machine Z was purchased for 80,000 on January 1, 2019. Double-declining-balance depreciation has been recorded for 1 year. The estimated residual value is 8,000 and the estimated service life is 5 years. The computation of the depreciation erroneously included the estimated residual value. Required: Prepare any necessary correcting journal entries for each situation. Also prepare the journal entry for each situation to record the depreciation for 2020. Ignore income taxes.On May 10, 2019, Horan Company purchased equipment for 25,000. The equipment has an estimated service life of 5 years and zero residual value. Assume that the straight-line depreciation method is used. Required: Compute the depreciation expense for 2019 for each of the following four alternatives: 1. Horan computes depreciation expense to the nearest day. (Use 12 months of 30 days each and round the daily depreciation rate to 2 decimal places.) 2. Horan computes depreciation expense to the nearest month. Assets purchased in the first half of the month are considered owned for the whole month. 3. Horan computes depreciation expense to the nearest whole year. Assets purchased in the first half of the year are considered owned for the whole year. 4. Horan records one-half years depreciation expense on all assets purchased during the year.
- Kansas Enterprises purchased equipment for $73,000 on January 1, 2024. The equipment is expected to have a five-year life, with a residual value of $7,950 at the end of five years. Using the double-declining balance method, the book value at December 31, 2025, would be: (Do not round your intermediate calculations) Multiple ChoiceKansas Enterprises purchased equipment for $78,000 on January 1, 2021. The equipment is expected to have a ten-year life, with a residual value of $7,200 at the end of ten years. Using the double-declining balance method, the book value at December 31, 2022, would be: (Do not round your intermediate calculations) Multiple Choice: $7,800 $49,920. $56,400. $54,000.Kansas Enterprises purchased equipment for $78,000 on January 1, 2021. The equipment is expected to have a ten-year service life, with a residual value of $9,000 at the end of ten years. Using the straight-line method, the book value at December 31, 2021, would be:
- John Deere purchased equipment for $60,000 on Jan. 1, 2021. The equipment is expected to have a five year life, with a residual life of $5,000 at the end of five years. Using the double declining balance method, the book value at December 31, 2022 would be: A. $21,600 B. $36,000 C. $45,600 D. $24,800Cutter Enterprises purchased equipment for $57,000 on January 1, 2021. The equipment is expected to have a five-year life and a residual O value of $7,200.Using the double-declining-balance method, the book value at December 31, 2022, would be:Multiple ChoiceO $20,520.O $21,720. O $19,620.O $11.400On January 2, 2019, Konan Corporation acquired equipment for $200,000. The estimated life of the equipment is 5 years or 40,000 hours. The estimated residual value is $10,000. What is the balance in Accumulated Depreciation on December 31, 2020, if Konan Corporation uses the double−declining−balance method of depreciation? (Round any intermediary calculations to two decimal places and your final answer to the nearest dollar.) A. $128,000 B. $48,000 C. $76,000 D. $190,000
- Kansas Enterprises purchased equipment for $77,000 on January 1, 2021. The equipment is expected to have a ten-year service life, with a residual value of $6,450 at the end of ten years. Using the double-declining balance method, depreciation expense for 2021 would be: (Do not round your intermediate calculations)Cutter Enterprises purchased equipment for $99,000 on January 1, 2021. The equipment is expected to have a five-year life and a residual value of $7,200. Using the double-declining-balance method, depreciation for 2022 would be:Cutter Enterprises purchased equipment for $51,000 on January 1, 2021. The equipment is expected to have a five-year life and a residual value of $6,300.Using the sum-of-the-years'-digits method, depreciation for 2022 and book value at December 31, 2022, would be: (Do not round depreciation rate per year) Multiple Choice $13,600 and $20,400 respectively. $11,920 and $24,180 respectively. $11,920 and $17,880 respectively. $13,600 and $14,100 respectively.
