Canliss mining uses the retirement method to

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91. Canliss Mining uses the retirement method to determine depreciation on its office equipment. During 2011, its first year of operations, office equipment was purchased at a cost of $14,000. Useful life of the equipment averages four years and no salvage value is anticipated. In 2013, equipment costing $5,000 was sold for $600 and replaced with new equipment costing $6,000. Canliss would record 2013 depreciation of: A. $3,500. B. $4,400. C. $5,400. D. None of the above is correct. Cost of equipment sold of $5,000 less proceeds of $600 = $4,400. AACSB: Analytic AICPA FN: Measurement Blooms: Apply Difficulty: 3 Hard Learning Objective: 11-Appendix 11B Retirement and Replacement Methods of Depreciation. Spiceland - Chapter 11 #91 Topic: Retirement and Replacement Methods of Depreciation
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92. Canliss Mining uses the replacement method to determine depreciation on its office equipment. During 2011, its first year of operations, office equipment was purchased at a cost of $14,000. Useful life of the equipment averages four years and no salvage value is anticipated. In 2013, equipment costing $5,000 was sold for $600 and replaced with new equipment costing $6,000. Canliss would record 2013 depreciation of: Cost of replacement equipment of $6,000 less proceeds of $600 = $5,400. AACSB: Analytic AICPA FN: Measurement Blooms: Apply Difficulty: 3 Hard Learning Objective: 11-Appendix 11B Retirement and Replacement Methods of Depreciation. Spiceland - Chapter 11 #92 Topic: Retirement and Replacement Methods of Depreciation
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93. Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term. 1. Straight-line method Occurs with a significant decline in value. 5 2. Double-declining balance Produces a level amount of annual depreciation. 1 3. Activity-based method Aggregates assets that are physically dissimilar when calculating depreciation. 4 4. Composite method Does not subtract residual value from cost when calculating depreciation. 2 5. Write-down of asset Estimates service life in units of output. 3 AACSB: Reflective Thinking AICPA BB: Critical Thinking Blooms: Understand Difficulty: 1 Easy Learning Objective: 11-02 Determine periodic depreciation using both time-based and activity-based methods. Learning Objective: 11-08 Identify situations that involve a significant impairment of the value of property; plant; and equipment and intangible assets and describe the required accounting procedures. Spiceland - Chapter 11 #93 Topic: Determine periodic depreciation using both time-based and activity-based methods Topic: Identify situations that involve a significant impairment of the value of PP & E and intangible assets and describe the required accounting procedures
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94. Listed below are five terms followed by a list of phrases that describe or characterize five of the terms. Match each phrase with the correct term.
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