A company purchased a machine for $100,000 on October 1, 2021. The estimated service life is 10 years with a $10,000 residual value

A company purchased a machine for $100,000 on October 1, 2021. The estimated service life is 10 years with a $10,000 residual value. The company records partial-year depreciation based on the number of months in service. Depreciation expense for the year ended December 31, 2021, using straight-line depreciation, is:

A) $1,500.

B) $7,500.

C) $2,250.

D) $2,500.

Answer: C

A company purchased a delivery truck on January 1, 2021, for $100,000. The truck has an estimated life of 10 years and an estimated residual value of $10,000. If the company uses double-declining balance, what would be the book value of the truck after two years?

A) $64,000.

B) $76,000.

C) $82,000.

D) $54,000.

Answer: A

A company purchased a delivery truck on January 1, 2021, for $65,000. The truck has an estimated life of 10 years and an estimated residual value of $5,000. If the company uses straight-line depreciation, what would be the book value after four years?

A) $41,000.

B) $60,000.

C) $36,000.

D) $24,000.

Answer: A

Kansas Enterprises purchased equipment for $60,000 on January 1, 2021. The equipment is expected to have a five-year service life, with a residual value of $5,000 at the end of five years.
Using the double-declining balance method, depreciation expense for 2022 would be:

A) $22,000.

B) $13,200.

C) $14,400.

D) $24,000.

Answer: C

Kansas Enterprises purchased equipment for $60,000 on January 1, 2021. The equipment is expected to have a five-year life, with a residual value of $5,000 at the end of five years.

Using the double-declining balance method, the book value at December 31, 2022, would be:

A) $21,600.

B) $24,800.

C) $36,000.

D) $45,600.

Answer: A

A machine has a cost of $15,000, an estimated residual value of $3,000, and an estimated useful life of four years. The machine is being depreciated on a straight-line basis. At the end of the second year, what amount will be reported for accumulated depreciation?

A) $9,000.

B) $6,000.

C) $7,500.

D) $3,000.

Answer: B