quiz #1 Accumulated depreciation will be the sum of two years of depreciation expense. Annual depreciation for this asset is ($400‚000 - $10‚000)/5 = $78‚000. The sum of two years depreciation is $156‚000 ($78‚000 + $78‚000). | | | Micah Bartlett Company purchased equipment on January 1‚ 2010‚ at a total invoice cost of $400‚000. The equipment has an estimated salvage value of $10‚000 and an estimated useful life of 5 years. The amount of accumulated depreciation at December 31‚ 2011‚ if
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_____________________ increase. ______________________________________________________________________________ AS-4 ( 1 ) When making an adjustment to record depreciation on property‚ plant and equipment‚ which accounts are used and how are they affected? Depreciation expense (an expense) will increase and accumulated depreciation (a contra______________________________________________________________________________ asset) will increase ______________________________________________________________________________
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-In 1984‚ there was a switch from accelerated to straight line depreciation retroactively. Because of this‚ the depreciation expense decreased. -The estimated depreciation lives on certain U.S. plants‚ machinery and equipment changed. The economic life of these assets was increased‚ so the depreciation expense was lowered. -There was an improvement in the minimum pension benefit. This change produced a lower pension expense. -The was a liquidation of LIFO inventory quantities carried at lower
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Q: Is depreciation expense or depreciation cost is fixed cost or variable cost in nature? Fixed costs: Fixed costs are such costs that do not change with the change in activity level within the relevant range. Where relevant range can be defined in terms of time or activity level. Variable costs: Variable costs are such costs that change with the change in activity level . Coming to the question‚ depreciation expense or depreciation cost can either be fixed or variable and this depends on the
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the trans-Atlantic market to serve Boston and New York. British Airways had made tremendous strides during pre-1986 to improve its profitability‚ and was preparing to go private in 1987. By 1986‚ BA had operating margins of 6.9% for its entire roster of routes and only 4.4% for Europe. The company had reduced its staff by 30% to 38‚000‚ exited non-core business programs and ceased service on many smaller unprofitable routes surrendering them to competitors. Aer Lingus‚ on the other hand was
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Cash 1‚800 12 Accounts Receivable 3‚700 Service Revenue 3‚700 18 Accounts Payable 1‚500 Cash 1‚500 20 Salaries Expense 2‚000 Cash 2‚000 21 Cash 1‚600 Accounts Receivable 1‚600 25 Accounts Receivable 2‚500 Service Revenue 2‚500 31 Gas & Oil Expense 290 Cash 290 31 Dividends 600 Cash 600 Cash Accounts Payable 07/01 12‚000 07/01 2‚000 07/18
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J & L Accounting‚ Inc. Income Statement For the Month Ending January 31‚ 2013 Revenues Service Revenues 8‚375.00 Expenses Advertising Expense 2‚350.00 Rent Expense 1‚000.00 Office Supplies Expense 75.00 Telephone Expense 660.00 Utilities Expense 2‚925.00 Depreciation Expense 1‚100.00 Total Expenses 8‚110.00 Net Income 265.00 J & L Accounting‚ Inc. Post-Closing Trial Balance January 31‚ 2013
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Problems Tutorial 1 IFM Case 2-2 Case 2-2 SKD Limited 1. Goodwill a. There is no goodwill amortization expense in Country A‚ so the goodwill amortization expense recognized by SKD must be added back to determine income under Country A GAAP. SKD amortizes goodwill over a longer period (20 years) than is allowed in Country B (5 years)‚ so an additional amount of goodwill amortization expense must be recognized to determine income under Country B GAAP‚ which reduces Country B GAAP income. b. The
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this period’s depreciation expense. To record accrued salaries expense. To record this period’s use of a prepaid expense. To record accrued interest revenue. To record accrued interest expense. To record the earning of previously unearned income. E Interest Expense 2‚208 Interest Payable C Insurance Expense 2‚208 3‚180 Prepaid Insurance F Unearned Professional Fees 3‚180 19‚250 Professional Fees Earned D Interest Receivable 19‚250 3‚300 Interest Revenue A Depreciation Expense 3‚300 38
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What is the cost of the land? a. $1 100 000 b. $1 195 000 c. $1 145 000 d. $1 125 000 3. Which of the following costs related to the purchase of production equipment incurred by ABC Company during 2013 would be considered an expense (revenue expenditure)? a. Installation costs for equipment b. Purchase price of the equipment less the cash discount c. Repair and maintenance costs during the equipment ’s first year of service d. Transportation charges to deliver
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