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Book
Year Value
2013 $17,000 $17,000 $163,000
Accumulated Book
Year Depreciation Value
2013 $27,000 $27,000 $153,000
Depreciation
Expense
Accumulated
Depreciation
$170,000 x 1/5 x 1/2
PROBLEM 9.2B
45 Minutes, Medium
R & R, INC.
a. (1) Straight-Line Schedule:
$180,000 x 30% x 1/2
Computation
Computation
(3) 150% Declining-Balance Schedule:
Depreciation
Expense
PROBLEM 9.2B
R & R, INC. (concluded)
Accumulated Book
Depreciation Value
$900 $900 $11,100
Year
2015
$12,000 x 15% x 1/2
Depreciation
Expense
Computation
(3) 150% Declining-Balance (half-year convention):
b.
1. Journal entry assuming that the furniture was sold for $780:
780
To record sale of furniture for $780 cash.
2. Journal entry assuming that the furniture was sold for $250:
250
Davidson may use the straight-line method in its financial statements to achieve the
PROBLEM 9.3B
DAVIDSON, DDS (concluded)
Cash
disposal must have been $2,600.
Cash
25 Minutes, Medium
Jan 6 Loss on Disposal of Plant Assets 1,200
Accumulated Depreciation: Office Equipment 16
,
800
Office Equipment 18,000
Scrapped equipment; received no salvage value.
Sold land and buildin
g
for a $100,000 cash down-
p
a
y
ment and a 5-
y
ear, 12% note for the balance.
To record trade-in of old truck on new; trade-in
allowance exceeded book value b
y
$8,000.
Ac
q
uired new com
p
uter s
y
stem b
y
tradin
g
in old
com
p
uter,
p
a
y
in
g
p
art cash, and issuin
g
a 1-
y
ear,
10% note payable. Recognized loss equal to book value of
old computer ($3,000) minus trade-in allowance ($400).
PROBLEM 9.4B
a.
General Journal
BLAKE CONSTRUCTION
25 Minutes, Medium
a.
c.
PROBLEM 9.5B
DELTA PRODUCTS CORPORATION
Operating expense. Although the training of employees probably has some benefit
extending beyond the current period, the number of periods benefited is highly uncertain.
Therefore, current accounting practice is to expense routine training costs.
Operating expense. Because of the great uncertainty surrounding the potential benefits of
R&D programs, the FASB has ruled that research and development costs should be
charged to expense in the period in which these costs are incurred. Although the FASB's
20 Minutes, Medium
250,000$
10
PROBLEM 9.6B
JELL STORES
a. Estimated goodwill associated with the purchase of Missy's:
Actual average net income per year
Typical sales multiplier
