the cost to instail an engine with higher horsepower O C. O D. the cost of now t

Question

the cost to instail an engine with higher horsepower O C. O D. the cost of now tire the cost to replace a broken windshiold estimated to be $56,000 A. $270,000 B. $204,800 C. $260,800 O D. $216,000 to use the for 33,000 hours aver "6. On January 1, 2017, Zade the next 5,700 hours in 2018. What is the depreciation expense for calculations to two decimal pl 2017 if the corporation uses the units-of-production method of depreciation? (Round any irdermediade and your final answer to the nearest dollar.) A. $5,652,540 O B. $7,159,884 O c. $13,833,333 O D. $5,659,110 7. The cost of an asset is $1,040,000, and its residual value is $290,000. Estimated usefulite of the asset is elight years, Calculate depreciation for the first year uasing the double-declining-balance methiod of depreciation. (Do not round any intermediate calculations, and round your final answer to the nearest dollar.) A $187,500 B. $260,000 $130,000 D. S93.750

Explanation / Answer

4. the cost to install an engine with higher horsepower. since it will increase the capacity of asset, then such cost should be capitalized.

$ 7 Cost of asset            10,40,000 less: Salvage value            (2,90,000) Depreciable amount               7,50,000 Useful life is 8 years Depreciation under stright line ($ 750,000/ 8)                  93,750 Depreication rate under stright line = ($ 93,750/750,000) = 13% Depreication rate under double decline= 13%x 2x book value of asset Depreciation for the first year = ( 2 x 13% x $ 1,040,000) = $ 260,000

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