Homework Quiz—16 S11 Section 2

Homework Quiz—16 S11 Section 2 - Spring...

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Spring 2011 Section 2 Homework Quiz —16 Name Section ABC Company acquired put into service a depreciable asset at the beginning of 2009. The asset had a cost of $675,000, residual value of $80,000, and expected life of 5 years. At the beginning of 2011 ABC estimated that the remaining life of the asset was 8 years and residual value was $105,000. Required : 1. Calculate book value for the asset as of the beginning of 2011. $437,000 $675,000 – [($675,000 - $80,000) x 2/5] 2. Prepare an entry to record revised depreciation expense for 2011. Debit Credit Depreciation expense [($437,000 - $105,000)/8] 41,500 Accumulated depreciation 41,500 Required : 3. At the beginning of 2009, ABC Company rented an empty warehouse it owned collecting $400,000 for a four-year operating lease. At the time the lease was signed ABC debited Cash and credited Unearned Rental Revenue $400,000. ABC forgot to record Rent Revenue and the reduction of Unearned Rental Revenue for this lease for 2009 and 2010. ABC discovered the error
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Homework Quiz—16 S11 Section 2 - Spring...

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