Chapter 10 week 5 P10-31A

Chapter 10 week 5 P10-31A - 42,140 20, 860 Dec 31, 2011 .49...

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P10-31A 1. Straight Line Method cost - residual value  = 63,000-14,200  = 48,800  = 8,133.33  useful life in years                 6                        6    Asset  Cost  Depreciation  Expense  Accumulated  Depreciation  Book  Value Jan 2, 2006   63,000      63,000 Dec 31,  2006     8,133  8,133  54,867 Dec 31,  2007    8,133  16,266  46,734 Dec 31,  2008     8,133  24,399  38,601 Dec 31.  2009     8,133  32,532  30,468 Dec  31. 2010     8,133  40,665  22,335 Dec 31,  2011     8,133  48,798  14,202 Unit of Production method    Asset  Cost Depreciation  per unit  No. of  units  Depreciation  expense  Accumulated  Depreciation  Bo ok  Val ue   Jan  2,  2006  63,000      63, 000  Dec  31,  2006    .49 x  18,000  8,820  8,820  54, 180  Dec  31,  2007    .49 x  18,000  8,820  17,640  45, 360  Dec  31,  2008    .49 x  18,000  8,820  26,460  36, 540  Dec     .49 x  18,000  8,820  35,280  27,
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31,  2009 720  Dec  31,  2010    .49 x  14,000  6,860
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Unformatted text preview: 42,140 20, 860 Dec 31, 2011 .49 x 14,000 6,860 49,000 14, 000 Double Declining Balance Asset Cost DDB Rate Book Value Depreciation Expense Accumulated Depreciation Book Value Jan 2, 2006 63,000 63,000 Dec 31, 2006 .33 x 63,000 20,790 20,790 42,210 Dec 31, 2007 .33 x 42,210 13,929 34,719 28,281 Dec 31, 2008 .33 x 28,281 9,333 44,052 18,948 Dec 31, 2009 .33 x 18,948 6,253 50,305 12,695 Dec 31, 2010 .33 x 12,695 4,189 54,494 8,506 Dec 31, 2011 .33 x 8,506 2,807 57,301 5,699 4,699 62,000 1,000 2. Speedway should be using the Double-Declining method this shows the highest net income in the early years and the lowest tax rate....
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Chapter 10 week 5 P10-31A - 42,140 20, 860 Dec 31, 2011 .49...

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