Question 1: Lockard Company purchased machinery on January 1, 2010, for $8,000 after a useful life of 8 years. (a) Compute 2010 depreciation expense using the straight-line method. (b) Compute 2010 depreciation expense using the straight-line method assuming the machinery was purchased on September 1, 2010.
Question 2: Use the information for Lockard Company given in BE11-2. (a) Compute 2010 depreciation expense using the sum-of-the-years-digits method. (b) Compute 2010 depreciation expense using the sum-of-the-years-digits method assuming the machinery was purchased on April 1, 2010.
Question 3: Use the information for Lockard Company given in BE11-2. (a) Compute 2010 depreciation expense using the double-declining-balance method. (b) Compute 2010 depreciation expense using the double-declining-balance method assuming the machinery was purchased on October 1, 2010.
Question 4: Jurassic Company owns machinery that cost $900,000 and has accumulated depreciation of $380,000. The expected future net cash flows from the use of the asset are expected to be $500,000. The fair value of the equipment is $400,000. Prepare the journal entry to record depletion.