Determine amount of depreciation for each truck during year

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Assignment:

Complete the following problems. You must show your work on the math problems to get full credit. Every student is responsible for completing their own responses to the following problems.

1. Consider the following data on an asset:

Cost of the asset, I:     $25,000
Useful life, N:               5 years
Salvage value, S:        $3,000

Compute the annual depreciation allowances and the resulting book values, using the straight-line depreciation method.

2. A company's accounting record shows the following:

                                                          Truck A                         Truck B
Useful Life (miles):                           250,000                         200,000
Miles Driven During Year:                  13,000                           11,000
Purchase Cost:                                $40,000                         $30,000
Salvage Value:                                   $4,250                           $3,000

Determine the amount of depreciation for each truck during the year.

3. Consider the following data on an asset:

Cost of the asset, I:     $35,000
Useful life, N:               7 years
Salvage value, S:        $4,000

Compute the annual depreciation allowances and the resulting book values, using the double-declining-balance method.

4. Identify which of the following expenditures is considered as a capital expenditure that must be depreciated (capitalized):

a) Painted the warehouse building, both interior and exterior, for $16,500.

b) Installed a conveyor belt system to automate some part of a production processes for $25,000.

c) Purchased a fax machine for $8,000.

d) Paid $18,000 to lease a dump truck for eight months.

e) Purchased a new computer system for $5,000.

f) Purchased land to build a new facility for $400,000.

g) Installed a water dispenser in a company dining area for $3250.

h) Purchased a patent on an energy-saving device over six years at a cost of $42,000.

i) Repaved a parking lot for $15,000.

j) Purchased a spare part for a framing machine for $5,000.

Reference no: EM131069172

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