Chapter 10 E11-15 ACC

Chapter 10 E11-15 ACC - (b) The most accurate distribution...

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EXERCISE 11-15 (a) 2005 2006–2011 Incl. 2012 Total (1) $240,000 – $21,000 = $219,000 $219,000 ÷ 12 = $18,250 per yr. ($50 per day) 133*/365 of $18,250 = $ 6,650 2006–2011 Include. (6 X $18,250) $109,500 68/365 of $18,250 = $ 3,400 $119,550 (2) 0 109,500 18,250 127,750 (3) 18,250 109,500 0 127,750 (4) 9,125 109,500 9,125 127,750 (5) 4/12 of $18,250 6,083 2006–2011 Inc. 109,500 3/12 of $18,250 4,563 120,146 (6) 0 109,500 0 109,500 *(11 + 30 + 31 + 30 + 31)
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Unformatted text preview: (b) The most accurate distribution of cost is given by methods 1 and 5 if it is assumed that straight-line depreciation is satisfactory. Reasonable accuracy is normally given by 2, 3, or 4. The simplest of the applications are 6, 2, 3, 4, 5, and 1, in about that order. Methods 2, 3, and 4 combine reasonable accuracy with simplicity of application....
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