Week 7 Homework for Acct 550 Essay

412 WordsApr 22, 20152 Pages
E11-4 a. \$315,000 – \$15,000 = \$300,000; \$300,000 ÷ 10 yrs. = \$30,000 b. \$300,000 ÷ 240,000 units = \$1.25; 25,500 units X \$1.25 = \$31,875 c. \$300,000 ÷ 25,000 hours = \$12.00 per hr.; 2,650 hrs. X \$12.00 = \$31,800 d. 10 + 9 + 8 + 7 + 6 + 5 + 4 + 3 + 2 + 1 = 55 OR n(n+1)/2 = 10(11)/2 = 55 10/55 x 300,000 x 1/3 = 18,182 9/55 x 300,000 x 2/3 = 32,727 Total for 2014 = 50,909 e. \$315,000 X 20% X 1/3 = \$21,000 [\$315,000 – (\$315,000 X 20%)] X 20% X 2/3 = 33,600 Total for 2014 \$54,600 E11-9 Estimated Depreciable Estimated Depreciation a. Asset Cost Salvage Cost Life per Year A \$ 40,500 \$ 5,500 \$ 35,000 10 \$ 3,500 B 33,600 4,800 28,800 9 3,200 C 36,000 3,600 32,400 9 3,600 D 19,000 1,500 17,500 7 2,500 E 23,500 2,500 21,000 6 3,500 \$152,600 \$17,900 \$134,700 \$16,300 Composite life = \$134,700 ÷ \$16,300, or 8.26 years Composite rate = \$16,300 ÷ \$152,600, or approximately 10.7% b. Depreciation Expense—Plant Assets 16,300 Accumulated Depreciation—Plant Assets 16,300 C. Cash 4,800 Accumulated Depreciation—Plant Assets 14,200 Plant Assets 19,000 E11-11 a. No correcting entry is necessary, because any changes in estimates are handled in the current and prospective periods. b. Revised annual charge Book value as of 1/1/2015 [\$60,000 – (\$7,000 X 5)] = \$25,000 Remaining useful life, 5 years (10 years – 5 years) Revised salvage value, \$4,500 (\$25,000 – \$4,500) ÷ 5 = \$4,100 Depreciation Expense—Equipment 4,100 Accumulated Depreciation—Equipment 4,100 E11-17 a. Loss on Impairment 3,220,000 Accumulated Depreciation—Equipment 3,220,000 Cost \$9,000,000 Accumulated depreciation 1,000,000 Carrying amount 8,000,000 Less: Fair value 4,800,000 Plus: Cost of disposal 20,000 Loss on