Bus230AMinitest8AnsKey

Bus230AMinitest8AnsKey - Net Book Value at end of Year 1...

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Bus 230A Minitest 8 Answer Key 1 b 2 b Combined Price of Land and Building  $260,000   $260,000  Building at 70% 0.7 Buiding Value  $182,000   (182,000) Land Value  $78,000  3 a Equipment cost  $154,000  Less: Salvage Value  (6,000) Depreciable Base  $148,000  Depreciation = 148,000/8yrs =  $18,500  Per Year 4 a If straight depreciation is 1/5 per year (20%)   then 200% of straight-line is 2/5 per year (40%). First year depreciation is $150,000 x 40% =  $60,000  Cost  $150,000  Less: First year's depreciation  (60,000)
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Unformatted text preview: Net Book Value at end of Year 1 $90,000 5 c 6 d 7 d 8 c Truck cost $36,000 Less: Accumulated Depreciation (20,000) Net Book Value $16,000 Sales price $14,000 Less: Net Book Value (16,000) Loss on Sale $(2,000) 9 a 10 c Extra Credit Problems 11 & 12: 11 b Net Income $2,176,000 Add: Interest Expense 192,000 Total $2,368,000 Return on Assets = (Net income + interest expense)/average total assets = 2,368,000/((19,042,000+21,209,000)/2) = 11.77% 12 c...
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This note was uploaded on 04/16/2008 for the course BUS 230A taught by Professor S during the Spring '08 term at Sonoma.

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