using the straight line method Depreciation for the first year $300‚000/5 = $60‚000 Question 1 using double declining 2/5 * $300‚000 = $120‚000 Straight line method is the simplest method of calculating depreciation. The amount charged each year over the useful life of the asset is uniform. Companies add up all the costs incurred to bring the asset in use. After cost are added the value is divided by useful life of the asset in years so as to come up with the depreciation expense. The important characteristic
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Chapter 9 Property Acquisition and Cost Recovery SOLUTIONS MANUAL Problems 39. [LO 1] Jose purchased a delivery van for his business through an online auction. His winning bid for the van was $24‚500. In addition‚ Jose incurred the following expenses before using the van: shipping costs of $650; paint to match the other fleet vehicles at a cost of $1‚000; registration costs of $3‚200 which included $3‚000 of sales tax and a registration fee of $200; wash and detailing for $50; and an engine
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Date | Description | | | | | | | | | | | | | Note: For further guidance please consult your supervisor or custodian of this document. Scope The purpose of this document to outline policies for management of assets i.e. depreciation‚ appreciation‚ amortization‚ stocktaking and accounting proceed from disposal. Policies 1. Stocktaking‚ Sale‚ Loss/damage‚ write-off‚ and revaluation of assets 1.1. Stocktaking of assets will be carried out by the Administration on yearly
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of 5 years and a $10‚000 residual value. Calculate depreciation expense and the year-end book value for 2010 and 2011 using the double declining-balance method of depreciation. *$120‚000 = $300‚000 2/5 **$72‚000 = $180‚000 2/5 Exercise 3: Hubbard Company purchased a truck on January 1‚ 2009‚ at a cost of $34‚000. The company estimated that the truck would have a useful life of 4 years and a residual value of $4‚000. A. Calculate depreciation expense under straight line and double declining balance
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Week Three Exercise Assignment Inventory 1. Specific identification method. Boston Galleries uses the specific identification method for inventory valuation. Inventory information for several oil paintings follows. Painting Cost 1/2 Beginning inventory Woods $21‚000 4/19 Purchase Sunset 21‚800 6/7 Purchase Earth 31‚200 12/16 Purchase Moon 4‚000 Woods and Moon were sold during the year for a total of $35‚000. Determine
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Accounting Assignment #434 Best Friends Vet Clinic Part A Qantas Airline Short Report in accordance to Accounting Perspective Introduction On November 14‚ 2012‚ Qantas applied a capital management measure by 1) repaying its $650 million debt earlier than scheduled and 2) investing up to &100 million in an on-market share buy-back. This was fulfilled to reflect the Board’s goal: returning shareholders’ value‚ maintaining a strong balance sheet while still have the flexibility to
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CASH FLOW AND FINANCIAL PLANNING: A. ANALYZING A FIRM’S CASH FLOW THE STATEMENT OF CASH FLOW “Cash flow‚ the lifeblood of the firm‚ is the primary ingredient in any financial valuation model.” - the summary of a firm’s cash flow over a given period‚ which uses the data from income statement‚ along with the beginning and end of period balance sheets. - allows the financial manager and other interested parties to analyze the firm’s cash flow - used to evaluate progress toward projected
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indirect method of operating cash flow. The largest adjustment to net income for both companies was the depreciation and amortization expense. In 2006 the net cash provided by operating activities for General Mills was $1‚771 millions‚ which was an increase of $60 millions from the $1711 millions in 2005. The largest adjustment to convert accrual net income into cash from operation was depreciation and amortization expenses totaling $424 millions in 2006. As for Kellogg’s in 2006 the net cash provided
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years is $28‚751‚000. The amount is 2010 is $14‚838‚000. The amount in 2011 is $13‚913‚000. B) The amount of depreciation expense in 2009 is $1‚104 (millions)‚ 2010 is $1‚093 and 2011 is $1‚086. C) Amounts on Cash Flow Statement for the most recent year that relate to depreciation‚ gains and sales of property and equipment‚ and purchases and sale of property of equipment is: Depreciation: 2011 - $954 (mill) Amortization: 2011 - $132 (mill) Proceeds from sale of equipment‚ property and investments/subsidiaries:
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Case Study: Hansson Private Label‚ Inc. Executive Summary The owner of Hansson Private Label (HPL) must determine whether or not to accept an aggressive expansion project that would preclude the company from pursuing any alternative investment opportunities for several years. The investment‚ if successful‚ would offer numerous benefits to the company‚ capturing greater market share‚ strengthening relationships with major customers‚ crowding out competition and increasing firm value. Nonetheless
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