Determine Cost of Land
Discount Delivery Company acquired an adjacent lot to construct a new warehouse, paying $25,000 and giving a short-term note for $300,000. Legal fees paid were $2,100, delinquent taxes assumed were $14,000, and fees paid to remove an old building from the land were $9,000. Materials salvaged from the demolition of the building were sold for $3,500. A contractor was paid $800,000 to construct a new warehouse.
Determine the cost of the land to be reported on the balance sheet.?$
Depreciation by Units-of-Production Method
A diesel-powered tractor with a cost of $185,000 and estimated residual value of $37,000 is expected to have a useful operating life of 40,000 hours. During February, the generator was operated 140 hours.
Determine the depreciation for the month. Carryout any division to one decimal place.
depreciation by Two Methods
A storage tank acquired at the beginning of the fiscal year at a cost of $344,000 has an estimated residual value of $50,000 and an estimated useful life of 16 years.
a. Determine the amount of annual depreciation by the straight-line method.?$3,125
b. Determine the amount of depreciation for the first and second years computed by the double-declining-balance method.
Disposal of Fixed Asset
Equipment acquired on January 4, 2009, at a cost of $425,000, has an estimated useful life of nine years and an estimated residual value of $65,000.
a. What was the annual amount of depreciation for the years 2009, 2010, and 2011, using the straight-line method of depreciation?
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Year
|
Depreciation Expense
|
|
2009
|
$
|
|
2010
|
$
|
|
2011
|
$
|
b. What was the book value of the equipment on January 1, 2012??$
Compare Three Depreciation Methods
Breyer Company purchased packaging equipment on January 3, 2010, for $101,250. The equipment was expected to have a useful life of three years, or 25,000 operating hours, and a residual value of $7,500. The equipment was used for 9,500 hours during 2010, 8,400 hours in 2011, and 7,100 hours in 2012.
Instructions:
Determine the amount of depreciation expense for the years ended December 31, 2010, 2011, and 2012, by the Straight-Line Method, the Units-of-Production Method, and the Double-Declining-Balance Method. Also determine the total depreciation expense for the three years by each method.
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Depreciation Expense
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|
Year
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Straight-Line Method
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Units-of-Production Method
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Double-Declining-Balance Method
|
|
|
|
|
2010
|
$
|
$
|
$
|
|
|
|
|
2011
|
$
|
$
|
$
|
|
|
|
|
2012
|
$
|
$
|
$
|
|
|
|
|
Total
|
$
|
$
|
$
|
|
|
|