INSTRUCTIONS: PROBLEMS- Solve each of the following probiems and record the answ

Question

INSTRUCTIONS: PROBLEMS- Solve each of the following probiems and record the answers in the o. If the cost of a fixed asset is $50.000 and its accumulated depreciation is $35,000, its book value s 1-3. Equipment costing $250.000 is sold for $80,000 315,000 1. If the accumulated loss (G or L) is depreciation was $150,000, the amount of gain or to he aecumulated depreciation was $200,000, the amount of gain or loss (G or L) is .. 3. If the accumulated depreciation was $250,000, the amount of gain or loss (G or L) is 4. A patent with a cost of $200.000 has an estimated useful life of 10 yedrs and a legal ife of 20 years. The annual amortization i Machinery acquired on the first day of the current fiscal year for $550,000 h a residual value of $O. Determine the depreciation for the current year by each of the following methods: 5. Straight·line 6. Double-declining-balance 7. Units-of-production (the equipment was used for 5,000 hours during Based on the data in Question 5-7, and assuming that the machinery was used for 10,000 hours in the second year, determine the depreciation for the second year by each of the following methods: the year) 8-9. 9. Units-of-production was used for 5,500 hours in the third year, determine the depreciation for the third year by each of the following methods: 10-11. Based on the data in Question 5-7, and assuming that the machinery 10.- 10. Double-declining-balance 11. Units-of production.

Explanation / Answer

1) $60,000 (SV ) - ($250,000 (cost) - $150,000(acc.dep.) -$40,000.00 Loss 2) $60,000 (SV ) - ($250,000 (cost) - $200,000(acc.dep.) $10,000.00 Gain 3) $60,000 (SV ) - ($250,000 (cost) - $250,000(acc.dep.) $60,000.00 Gain 4) Amortization = $200,000/10 years $20,000.00

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