TUTOR QUESTIONS FOR CHAPTER 9,10 - TUTOR QUESTIONS FOR...

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TUTOR QUESTIONS FOR CHAPTER 9, 10 Accounting I Instructor: Dr. Nguyen The Loc Tutor: Minh, MBA Group Members: Dang The Duong Vu Hoang Duong Nguyen Thi My Hanh Lam Vu Truc Thuy Pham Tuyet Nhung
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E 9-28 (p.433) 1. What is the cost of the machine to Freddy’s Restoration Company? Machine cost $45,000 Sales tax 2,000 Delivery costs 1,000 Assembly cost 600 Cost of machine $50,000 2. What is the amount of the first full year’s depreciation if Freddy’s uses the straight -line method? $50,000 Depreciation expense = = $3,333 depreciation expense/year 15 years E 9-30 (p.434) 1. Jan. 1 Lease property. .............................................. 9,413 Lease liability. .................................... 9,413 To record a copy machine acquired under a 5 years non-cancelable lease. Jan.31 Lease liability. ............................................... 122 Interest Expense. ............................................ 78 Cash. ................................................... 200 To record annual lease payment under capital lease.
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2. Jan.1 There is no entry required because, this is the operating lease. The payment will be made at the end of each month. Jan.31 Rent Expense. ................................................ 200 Cash. ................................................... 200 To record monthly rent of office building. E 9-33 (p.434) 1. 2008 a. Straight-line: 26,000 – 1,000 6 Depreciation expense = x = $2,500/year 5 12 b. Units-of-production : 26,000 – 1,000 Depreciation expense = x 9,000 = $2,045 110,000 2009 a. Straight-line:
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26,000 - 1,000 Depreciation expense = = $5,000/ year 5 b. Units-of-production : 26,000 – 1,000 Depreciation expense = x 24,000 = $5,455 110,000 2. Units-of-production depreciation method in which the cost of an asset is allocated to each period on the basis of the productive output or use of the asset during the period is more closely reflects the used-up service potential of the car. In this method, cost – salvage is divided by the asset’s useful life measured in miles (not in years as in straight-line method) to acquire the average depreciation expense per mile, and then multiply by the usage for the year. E 9-37 (p. 435) Original cost . ....................................................................... $700,000 Accumulated Depreciation, Building. .................................. (150,000) Book Value. ............................................................................ 550,000 (Book value = Original cost – Accumulated Depreciation, Building) Journal Entry: Accumulated Depreciation, Building. ................................. 150,000
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Loss on Impairment of Building and Land. ......................... 430,000 Building (550,000-70,000). ...................................... 480,000 Land (150,000 – 50,000). ......................................... 100,000 (Recognized $430,000 impairment loss on building and land) E 9-38 (p.435) Accounting for the Disposal of Assets Using straight-line method, accumulated depreciation of the truck (after 4 years):
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This note was uploaded on 06/20/2011 for the course ECON 123 taught by Professor Mrews during the Spring '11 term at Korea Advanced Institute of Science and Technology.

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TUTOR QUESTIONS FOR CHAPTER 9,10 - TUTOR QUESTIONS FOR...

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