69.
Schager Company purchased a computer system on January 1, 2016, at a cash cost of
$25,000. The estimated useful life is 10 years, and the estimated residual value is $3,000. The
company will use the double declining-balance depreciation method.
How much is the 2017 depreciation expense?
70.
Schager Company purchased a computer system on January 1, 2016, at a cash cost of
$25,000. The estimated useful life is 10 years, and the estimated residual value is $3,000. The
company will use the double declining-balance depreciation method.
What is the accumulated depreciation balance as of December 31, 2017?
71.
On January 1, 2016, Wasson Company purchased a delivery vehicle costing $40,000. The
vehicle has an estimated 6-year life and a $4,000 residual value.
What is the vehicle’s book value as of December 31, 2017, assuming Wasson uses the
straight-line depreciation method?
72.
On January 1, 2016, Wasson Company purchased a delivery vehicle costing $40,000. The
vehicle has an estimated 6-year life and a $4,000 residual value.
Wasson uses the units-of-production depreciation method and Wasson estimates that the
vehicle will be driven 100,000 miles. What is the vehicle’s book value as of December 31, 2017
assuming the vehicle was driven 10,000 miles during 2016 and driven 18,000 miles during
2017?
73.
Which of the following statements is false?
74.
Under what conditions would a company most likely adopt the double-declining-balance
method for financial reporting?
75.
Which of the following statements is correct?
76.
Which of the following statements is correct?
77.
Which of the following statements about the Modified Accelerated Cost Recovery System
(MACRS) is correct?
78.
Which of the following statements about asset impairment is false?
79.
A company has some bottling equipment which cost $8.5 million, has a net book value of $4.1
million, estimated future cash flows of $3.7 million, and a fair value of $3.1 million.
How much is the asset impairment loss?
80.
A company has some bottling equipment which cost $8.5 million, has a net book value of $4.1
million, estimated future cash flows of $3.7 million, and a fair value of $3.1 million.
Which of the following correctly describes the recording of the asset impairment loss?
81.
On December 31, 2016, Hamilton Inc. sold a used industrial crane for $600,000 cash. The
original cost of the crane was $5.0 million and its accumulated depreciation equaled $4.2
million on December 31, 2016. What is the gain or loss from the December 31, 2016
equipment sale?
82.
Which of the following is correct when recording the disposal of equipment for a gain?
83.
Which of the following is correct regarding gain or loss on disposal of a long-lived asset?
84.
Which of the following statements is correct with respect to the sale of a depreciable asset?
85.
Carter Company disposed of an asset at the end of the eighth year of its estimated life for
$10,000 cash. The asset’s life was originally estimated to be 10 years. The original cost was
$50,000 with an estimated residual value of $5,000. The asset was being depreciated using
the straight-line method. What was the gain or loss on the disposal?
86.
Which of the following journal entries is correct when a company owns its office building for
many years and now sells the building?
87.
Which of the following statements is correct with respect to a loss on the sale of a
depreciable asset?
88.
Amanda Company purchased a computer that cost $10,000. It had an estimated useful life of
five years and a residual value of $1,000. The computer was depreciated by the straight-line
method and was sold at the end of the third year of use for $5,000 cash.
How much of a gain or loss should Amanda record?
89.
Amanda Company purchased a computer that cost $10,000. It had an estimated useful life of
five years and a residual value of $1,000. The computer was depreciated by the straight-line
method and was sold at the end of the third year of use for $5,000 cash.
Which of the following statements correctly describes the computer sale?
90.
On March 1, 2016, Anniston Company purchased an oil well at a cost of $1,000,000. It is
estimated that 150,000 barrels of oil can be produced over the remaining life of the well and
the residual value of the well will be $100,000.
During 2016, 15,000 barrels of oil were produced and all of these barrels were sold. Which of
the following statements is incorrect with respect to the accounting for the oil well?
91.
On March 1, 2016, Anniston Company purchased an oil well at a cost of $1,000,000. It is
estimated that 150,000 barrels of oil can be produced over the remaining life of the well and
the residual value of the well will be $100,000.
During 2016, 15,000 barrels of oil were produced and 10,000 barrels were sold. Which of the
following statements is correct with respect to the accounting for the oil well?