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me3232-F10-hw6 - ME 3232 Homework#6 due 1 A new drill press...

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ME 3232 Homework #6, due 11/1/10 1. A new drill press was purchased for $95,000 by trading in a similar machine that had a book value of $25,000. Assuming that the trade-in allowance is $20,000 and that $75,000 cash is to be paid for the new asset, what is the cost basis of the new asset for book depreciation purposes? 2. A second-hand bulldozer acquired at the beginning of the fiscal year at a cost of $58,000 has an estimated salvage value of $8000 and an estimated useful life of 12 years. Determine the following: (a) The amount of annual depreciation by the straight-line method, (b) The amount of depreciation for the third year computed by the declining balance method (d=1/12), (c) The amount of depreciation for the second year computed by the sum-of-years’- digits method. 3. Ingot Land Company owned four trucks dedicated primarily for its landfill business. The company’s accounting record indicates the following: Determine the amount of depreciation for each truck during the year using units-of- production method.
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