1. A company has developed a tract of land for resort. The company has cut the trees, cleared and graded the land and hills, and got the land ready. (a) Should the tree cutting, land clearing, and grading costs of constructing the land be recorded as an increase in the land account? (b) If such costs are recorded as an increase in Land, should they be depreciated?
2. A company acquired an adjacent lot to construct a new warehouse, paying $200,000 and giving a short-term note for $300,000. Legal fees paid were $6,200, delinquent taxes assumed were $14,000, and fees paid to remove an old building from the land were $6,500. Materials salvaged from the demolition fo the building were sold for $2,900. Determine the cost of the land to be reported on the balance sheet.
3. A transporting company incurred the following costs relate to an 18- wheel truck:
a. Replaced the hydraulic brake system that had begun to fail during her latest trip through the Rocky Mountains
b. Replaced a shock absorber that had worm out
c. Replaced a headlight that had burned out
d. Replaced fog and cab light bulbs
e. Removed the old GPS navigation system and replaced it with a newer model
f. Modified the factory-installed turbo charger with a special-order kit designed to add 50 more horsepower ot the engine performance g. Installed a wind deflector on top of the cab to increase fuel mileage
h. Installed a television in the sleeping compartment of the truck i. Changed engine oil
2 A company reported #7,900,800 for equipment and $ 3,500,000 for accumulated depreciation-equipment on its balance sheet. Does this mean (a) that the replacement cost fo the equipment is $7,900,800 and (b) that $3,500,000 is set aside in a special fund for the replacement of the equipment?
3 Convert each of the following estimates of useful life to a straight-line depreciation rate, stated as a percentage, assuming that the residual value of the fixed asset is the be ignored: We also discuss several other topics like What is the exact speed of sound?
a. 2 years
b. 4 years
c. 10 years
d. 20 years
e. 25 years
f. 40 years
g. 50 years
2 An oven has a cost of $74,320, an estimated residual value of $3,820, and an estimated useful life of 25 years. What is the amount of the annual depreciation computed by the straight-line method?
3 A piece of machinery was acquired on January 7 at a cost of $340,000 has an estimated useful life of 20 years. Assuming that it will have no residual value,
determine the depreciation for each of the first two years by (a) the straight line method and (b) the double-declining-balance method. If you want to learn more check out How do we go from scenes and objects in the world to scenes and objects in maps and pictures?
4 A Dishwasher acquired at the beginning of the fiscal year at a cost of $275,000 has an estimated residual value of $25,000 and an estimated useful life of 20 years. Determine the following: (a) the amount of annual depreciation by the straight-line method and (b) the amount of depreciation for the first and second years computed by the double-declining-balance method.
5 Equipment acquired at a cost of $48,000 has an estimated residual value of $6,000 and an estimated useful life of 10 years. It was placed in service on July 1 of the current fiscal year, which ends on December 31, 2015. Determine the depreciation for 2015 and for 2016 by (a) the straight-line method and (b) the double-declining-balance method. We also discuss several other topics like What is an example of a religious ritual?
6 Equipment acquired at a cost of $615,000, has an estimated useful life of 20 years, has an estimated value of 32,500, and is depreciated by the straight line method. What was the book value of the equipment after 4 years?
7 A company acquired patent rights for $1,400,700 with a useful life of 10 years. 4 years later the company successfully defended the patent in a lawsuit at a cost of $19,720. What is the patent amortization expense for the current year (4 years later)?
1 A company warrants its products for one year. The estimated product warranty is 5% of sales. Assume that sales were $500,000 for July. In August, a customer received warranty repairs requiring $13,600 of parts. Determine the warranty liability at July 31, the end of the first month of the current year. Don't forget about the age old question of Does american dream actually exist in country that no longer considers itself exceptional?
2 An employee earns $30 per hour and 1.5 times that rate for all hours in excess of 40 hours per week. Assume that the employee worked 55 hours during the week, and that the gross pay prior to the current week totaled $70,000. Assume further that he social security tax rate was 7%, the Medicare tax rate was 1.5%, and the federal income tax to be withheld was $150. What was his (a) gross pay for the week and his (b) net pay for the week.
3 According to this company's payroll, $425,000 was subject to the 8.5% FICA tax. Also, $50,000 was subject ot state (3.9%) and federal (1.1%) unemployment taxes. What is the employer's payroll taxes?
4 On September 9, a company reacquired 30,000 shares of its common stock at $51 per share. (a) what is the balance of treasury stock on December 31 of the current year?
1. (Yes) (No)
3. Capital Expenditure: A, E, F, G, H
Revenue Expenditure: B,C,D, I
1. (No) (No)
2. (1/2 = 50%) (1/4 = 25%) (1/10 = 10%) (1/20 = 5%) 1/25 = 4%) (1/40 = 2.5%) (1/50 = 2%)
4. (1st = 17,000; 2nd = 17,000) (1st = 34,000; 2nd = 30,600) 5. (1st = $12,500) (1st = $27,5000; 2nd = $24,750)
6. (2015 = $2,100; 2016 = $4,200) (2015 = $4,800; 2016 = $8,640) 7. $116,500 Don't forget about the age old question of Is the carbon feedback cycle a positive or negative feedback loop?
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10. ($1,875) ($1,565.63)