Equipment with a cost of $390,000 and estimated residual value of $60,000 is expected to have a useful life of 30,000 hours

Equipment with a cost of $390,000 and estimated residual value of $60,000 is expected to have a useful life of 30,000 hours. During August, the equipment was operated 700 hours. What amount should be recorded as depreciation expense for the month?

A) $8,400.

B) $7,700.

C) $9,100.

D) $7,000.

Answer: B

A company purchases a piece of equipment on January 1, 2021, for $70,000 and the equipment has an expected useful life of five years. Its residual value is estimated to be $10,000. Assuming the company uses the straight-line depreciation method, what should be the balance in accumulated depreciation for the equipment as of December 31, 2023 (three years later)?

A) $44,000.

B) $32,000.

C) $36,000.

D) $42,000.

Answer: C

A building was purchased for $50,000. The asset has an expected useful life of six years and depreciation expense each year is $8,000 using the straight-line method. What is the residual value of the building?

A) $0.

B) $2,000.

C) $4,000.

D) $6,000.

Answer: B

Kansas Enterprises purchased equipment for $60,000 on January 1, 2021. The equipment is expected to have a five-year service life

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 2021 would be:

A) $24,000.

B) $22,000.

C) $19,000.

D) $20,000.

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 straight-line method, depreciation expense for 2022 and the book value at December 31, 2022, would be:

A) $12,000 and $36,000.

B) $12,000 and $31,000.

C) $11,000 and $33,000.

D) $11,000 and $38,000.

Answer: D

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 straight-line method, the book value at December 31, 2021, would be:

A) $44,000.

B) $49,000.

C) $55,000.

D) $60,000.

Answer: B