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Sunday, November 14, 2010

Valix Finacc vol 1 Problem 17-11

Financial Accounting Volume 1 2008 Valix-Peralta
Chapter 17 Problem 17-11



   2003                                                             
Jan.    1  Machinery                                                                             900,000
                        Cash                                                                                                    900,000

Dec. 31  Depreciation (20% x 900,000)                                     180,000
                        Accumulated depreciation                                                               180,000

   2004
Dec. 31  Depreciation                                                                         180,000
                        Accumulated depreciation                                                                180,000
                                                                                                                                   
   2005
Dec. 31  Depreciation                                                                         180,000
                        Accumulated depreciation                                                                180,000
           
   2006
Dec. 31  Depreciation                                                                         180,000
                        Accumulated depreciation                                                                180,000

              Cash                                                                                        10,000
              Accumulated depreciation                                                  170,000
                        Machinery (4 x 45,000)                                                              180,000

   2007
Dec. 31  Depreciation (720,000 x 20%)                                     144,000
                        Accumulated depreciation                                                                144,000

               Cash                                                                                       15,000
               Accumulated depreciation                                     615,000
                        Machinery (14 x 45,000)                                                                        630,000
                                                                                                                                   
   2008
Dec. 31  Depreciation                                                                            9,000
                        Accumulated depreciation                                                                  9,000

              Remaining cost                                                                                             90,000
              Less: Balance of accumulated depreciation                                                79,000
              Book value                                                                                                    11,000
              Less: Salvage proceeds                                                                                   2,000
              Maximum depreciation                                                                                   9,000

               Cash                                                                                       2,000
               Accumulated depreciation                                     88,000
                        Machinery (4 x 45,000)                                                               90,000

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