ch 9 - Chapter 9 Suggested Practice Problems BRIEF EXERCISE...

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Chapter 9 Suggested Practice Problems BRIEF EXERCISE 9-2 The cost of the truck is $20,280 (cash price $18,000 + sales taxes $1,080 + painting and lettering $1,200). The expenditures for insurance and motor vehicle license should not be added to the cost of the truck. BRIEF EXERCISE 9-5 (a) Accumulated Depreciation—Delivery Equipment. . 41,000 Delivery Equipment. .............................................. 41,000 (b) Accumulated Depreciation—Delivery Equipment. . 36,800 Loss on Disposal. ...................................................... 4,200 Delivery Equipment. .............................................. 41,000 Cost of delivery equipment $41,000 Less accumulated depreciation 36,800 Book value at date of disposal 4,200 Proceeds from sale 0 Loss on disposal $ 4,200 BRIEF EXERCISE 9-7 (a) Amortization Expense—Patent ($180,000 ÷ 5). ....... 36,000 Patent. ................................................................. 36,000 (b) Intangible Assets Patent (Net of $36,000 of amortization). .......... $144,000 BRIEF EXERCISE 9-8 (a) Return on assets ratio = $2.3 ($25.5 + $27.8)/2 = 8.6% (b) Asset turnoverratio = $19.1 ($25.5 + $27.8) ÷ 2 = .72 times 9-1
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EXERCISE 9-3 Straight-line method: $96,000 – $6,000 8 = $11,250 per year. 2007 depreciation = $11,250 X 4/12 = $3,750 2008 depreciation = $11,250 . EXERCISE 9-5 (a) Accumulated Depreciation—Delivery Equipment. ... 20,000 Loss on Disposal. ...................................................... 34,000 Delivery Equipment. .......................................... 54,000 (b) Cash. ........................................................................... 37,000 Accumulated Depreciation—Delivery Equipment. .......................................................... 20,000
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ch 9 - Chapter 9 Suggested Practice Problems BRIEF EXERCISE...

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