Case study of kleener company

Assignment Help Accounting Basics
Reference no: EM13256992

Kleener Co acquired a new delivery truck at the beginning of its current fiscal year. The truck cost 26,000 and has an estimated useful life of four years, and an estimated salvage value of 4000.

Required:

A. Calculate depreciation expense for each year of the truck's life using

1. Straight line depreciation

2. Double-declining balance method

B. Calculate the truck's net book value at the end of its third year of use under each depreciation method.

C. Assume that Kleener Co. had no more use for the truck after the end of the third year and that at the beginning of the fourth year it had an offer from a buyer who was willing to pay 6200 for the truck. Should the depreciation method used by Kleener Co. affect the decision to sell the truck?

Reference no: EM13256992

Questions Cloud

What is probability that anyone of nodes will access channel : Given a network using slotted Aloha multiple access protocol with N users and each user attempting to access the channel with probability P. It is safe to assume that each user always has a frame of data to send and that it uses access probability
Finding relevant costs when dropping a product : Merchant's sales manager believes that it is important to continue to produce JT484 to maintain a full product line. He expects the elimination of JT484 will reduce sales of the remaining two products by 5% each. Will this information change your ..
Compute the molar mass of the unkown gas : Under the same conditions of temperature and pressure it takes an equal volume of bromine vapor 4.74 min to effuse through the same hole. Calculate the molar mass of the unkown gas and suggest what this gas might be.
How to derive delta of a put option using put-call parity : How to derive the delta of a put option using put-call parity. Please show works. Thanks
Case study of kleener company : Kleener Co acquired a new delivery truck at the beginning of its current fiscal year. The truck cost 26,000 and has an estimated useful life of four years, and an estimated salvage value of 4000.
Prepare journal entries necessary to reflect transactions : Accounts receivable of $138,000 were collected includingaccounts of $40,000 on which 2% sales discounts were allowed. Prepare all journal entries necessary to reflect the transactions above.
What is the effective rate of interest on installment loan : Lewis and Clark Camping Supplies Inc. is borrowing $78,000 from Western State Bank. The total interest is $14,200. The loan will be paid by making equal monthly payments for the next three years.
Utility of the walker and mullins research : The assigned articles for this week contribute an appealing expansion to the utility of the Walker and Mullins research. What are the basic propositions offered?
How to use a mealy model with minimum number of states : Draw a state diagram for a synchronous sequence detector that will detect every occurence of the sequence 111001 in a serially transmitted message of any length. The sequence detector should detect overlapping sequences as well as individual occur..

Reviews

Write a Review

 

Accounting Basics Questions & Answers

  Prepare an income statement for the adjusted trial balance

Prepare an income statement for the adjusted trial balance of Hanson Storage. Prepare a balance sheet from the adjusted trial balance of Hanson Storage

  Volume of sales invoices

Twyla Enterprises uses a word processing computer to handle its sales invoices. Lately, business has been so good that it takes an extra 3 hours per night, plus every third Saturday, to keep up with the volume of sales invoices.

  Dodger statements for financial reporting purpose

Assuming Dodger's tax rate is 30 percent in all periods, and that the company uses the carryback provisions, what amount should appear in Dodger's statements for financial reporting purposes as a net loss in 2011?

  Developing profit and return on investment

Through hard work and careful saving, Hans and his family have152,000 to start a small business. The family estimates sales tocustomers will be about $4,500 per month during the first year. Onthe average, expected cost per month are budgeted as fo..

  What are some of the limitations of the equity method

Compare and contrast the Fair-Value Method (FAS 115) covered in your Intermediate Accounting courses (touched on in our textbook) and Equity Method. When should you use each method and why? What are some of the limitations of the Equity Method? (T..

  Impotance of periodic reporting and time period principle

Discuss the impotance of periodic reporting and the time period principle

  Determine alexandra basis in the land

Dove Corporation had purchased the land as an investment three years ago for $375,000, and the land was distributed subject to a $270,000 liability. Alexandra took the land subject to the $270,000 liability. What is Alexandra's basis in the land?

  What is the amount of the impairment

The expected, undiscounted, net cash flows from the use of the asset and the eventual disposition are determined to be $760,000, and it has a current market value of $710,000. What is the amount of the impairment, if any, that should be recorded b..

  Howells correct ending inventory balance

What is Howell's correct ending inventory balance at December 31, 2010?

  Consider an investment scenario that returns a level stream

Consider an investment scenario that returns a level stream of four annual payments of $10,000 each (i.e., an annuity). The first payment occurs at the end of the first year, and the subsequent payments occur at the end of each of the next three year..

  Determine lear earnings after taxes under financing plan

Lear Co. wishes to finance all fixed assets and half of its permanent current assets with long-term financing. Lear's earnings before interest and taxes are $250,000. Determine Lear's earnings after taxes under this financing plan.

  Target corporation-liquidity and efficiency

Examine Target for the years 2004-2006 and compare to Walmart. Comment on the relative liquidity and efficiency these firms. How does Target compare to Walmart? Would you invest in this company?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd