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1) The calculation for annual depreciation using the straight-line depreciation method is A. initial cost / estimated useful life B. depreciable cost / estimated useful life C. depreciable cost * estimated useful life D. initial cost * estimated useful life
2) On December 31, Strike Company has decided to discard one of its batting cages. The initial cost of the equipment was $310,000 with an accumulated depreciation of $260,000. Depreciation has been taken up to the end of the year. The following will be included in the entry to record the disposal. A. Accumulated Depreciation Dr. $310,000 B. Loss on Disposal of Asset Dr. $260,000 C. Equipment Cr. $310,000 D. Gain on Disposal of Asset Cr. $50,000
3) An aging of a company's accounts receivable indicates the estimate of uncollectible receivables totals $7,900. If Allowance for Doubtful Accounts has a $700 credit balance, the adjustment to record the bad debt expense for the period will require a A. debit to Bad Debt Expense for $8,600. B. debit to Bad Debt Expense for $7,900. C. debit to Bad Debt Expense for $7,200. D. credit to Allowance for Doubtful Accounts for $700.
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