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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Chapter 1: Environment and Theoretical Structure of Financial Accounting Accounting Principles Board (APB) The Accounting Principles Board (APB) followed the CAP. Asset/liability approach With the asset/liability approach‚ recognition and measurement of assets and liabilities drives revenue and expense recognition. Auditors Auditors express an opinion on the compliance of financial statements with GAAP. Capital markets The capital markets provide a mechanism to help our economy allocate
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Decrease in Prepaid Expenses 4‚000‚000.00 Increase in Accounts Payable 1‚000‚000.00 Decrease in Accrued Liabilities -2‚000‚000.00 Decrease in taxes payable -5‚000‚000.00 Increase in Deferred Taxes 5‚000‚000.00 Depreciation 11‚000‚000.00 Net cash provided by operating activities 1‚000‚000.00 Investing Activities
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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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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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the following: a. prescription of the period of assessment and collection b. error in disallowing claimed depreciations (upon these supplemented facts) i. Basilan Estates‚ Inc. claimed deductions for the depreciation of its assets up to 1949 on the basis of their acquisition cost. ii. Accordingly‚ from 1950 to 1953 it deducted from gross income the value of depreciation computed on the reappraised value. iii. Upon investigation and examination of taxpayer’s books and papers‚ the
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but not for July.) OFF-CAMPUS THEATER Unadjusted Trial Balance July 31‚ 2002 Cash $ 16‚200 Prepaid film rental 28‚000 Land 100‚000 Building 240‚000 Accumulated depreciation: building $ 16‚000 Fixtures and equipment 12‚000 Accumulated depreciation: fixtures and equipment 3‚000 Notes payable 190‚000 Accounts payable 3‚200 Unearned admissions revenue (YMCA) 1‚200 Income taxes payable 6‚100 Capital Stock
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Depending on the depreciation method that they choice to use‚ it will reflect the estimate. As noted in the book‚ “when a company changes the way it depreciates an asset in midstream‚ the change would be made to reflect a change in‚ either an estimated future benefit from the asset‚ the patterns of receiving those benefits‚ or the company’s knowledge about those benefits” (McGraw-Hill Companies‚ 2010). When this company changes there previous estimate‚ they don’t have to amend their prior financial
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