Exam 16: Recording and Evaluating Capital Resource Process Activities: Investing

Windstreamers,Inc.acquired a piece of machinery on January 3,2010.The total cost of the machinery was $68,400.Windstreamers estimated that the machinery would be used to produce 100,000 units of product before being sold for an estimated $11,600.Windstreamers uses the units-of-production method of depreciation.Assuming the machine produced 18,500 units during the year ended December 31,2010,the 2008 depreciation expense was:

Eric Lynd Industries sold equipment with an original cost of $80,000 and accumulated depreciation of $35,000.If the sale of the equipment generated a gain of $10,000 how much cash was received from the sale?

Blythe Company has equipment with an original cost of $150,000 and accumulated depreciation of $40,000.What is the current fair value of the equipment?

Technonerds,Inc.owns a piece of lab equipment with an original cost of $39,500,and a current carrying value of $17,450.Determine the gain or loss for each of the following situations: ( A)the equipment is sold for $23,800 cash (b)the equipment is sold for scrap and $750 in cash is received (c)the equipment is sold for a 12-month $25,000 note receivable with a stated 9% interest rate

Cooper Resources,Inc.owns some equipment with an original cost of $53,800 and accumulated depreciation of $26,350.If the equipment is sold for $28,500,the gain or loss recognized on the sale would be:

Harold Lynd Corporation sold equipment with an original cost of $90,000 for $55,000 cash and recorded a gain of $5,000.What was the book value of the equipment on the date of the sale?

Which of the following would be classified as a plant asset?

Advanced Systems,Inc.purchased a machine 4 years ago at a price of $82,800.At that time,useful life was estimated at 10 years with a $13,500 salvage value,and straight-line depreciation was used.After recording depreciation for the 4th year,Advanced decided that for future years it would revise its original estimates from 10 to 14 years and from $13,500 to $8,500.The depreciation expense to be recorded in year 5 of the machine's life is:

Gorham Company has equipment with an original cost of $250,000 and accumulated depreciation of $140,000.If the equipment was sold it would generate a $15,000 Gain.What is the current fair value of the equipment?

Comptel Corporation purchased land,a building and equipment for a total cost of $525,000.The appraised values of the land,building and equipment were $150,000,$375,000 and $75,000,respectively.The purchase price allocated to the equipment should be:

Which of the following is the correct entry for the sale of equipment at a loss?

Cost to repair damage to machine incurred when installing the machine should be:

Sportech,Inc.acquired a piece of equipment on January 3,2010.The total cost of the equipment was $77,500.Sportech estimated that the equipment would be used for 9 years before being sold for an estimated $5,500.Assuming the use of straight-line depreciation,the balance in the accumulated depreciation account on January 2,2014 will be:

Golden Eagle Golf Corp sold equipment with an original cost of $160,000 and accumulated depreciation of $95,000.If the sale of the equipment generated a loss of $15,000 how much cash was received from the sale?

Mallory Technical Services obtained a new machine.Which of the following would not be included in the cost of the machine?

Gfeller Corporation had a machine,which initially cost $25,000 and had accumulated depreciation of $11,000 when it decided to sell the machine for $8,000 cash.Make the entry to record the sale of the machine.

Byrons,Inc.acquired a piece of equipment on January 3,2010.The total cost of the equipment was $28,500.Byrons estimated that the equipment would be used for 6 years before being sold for an estimated $4,500.Assuming the use of straight-line depreciation,the total depreciation expense for the year ended December 31,2010 was:

Comment on this statement: "Salvage value is ignored when the declining balance depreciation method is used."

Wilkens Corporation acquired a delivery truck on January 4,2010.The total cost of the truck was $138,000.Wilkens estimated that the truck would be used for 10 years before being sold for an estimated $28,500.Wilkens uses the double-declining balance method of depreciation.The carrying value of the truck on January 2,2014 will be: