Question: Chapin Freight purchased a building for 800 000 and depreciated it
Chapin Freight purchased a building for $800,000 and depreciated it on a straight-line basis over a 30-year period. The estimated residual value was $110,000. After using the building for 15 years, Chapin realized that wear and tear on the building would force the company to replace it before 30 years. Starting with the sixteenth year, Chapin began depreciating the building over a revised total life of 20 years and increased the estimated residual value to $170,000. Record depreciation expense on the building for years 15 and 16.
Relevant QuestionsOn January 2, 2014, Shine Lights purchased showroom fixtures for $18,000 cash, expecting the fixtures to remain in service for five years. Shine Lights has depreciated the fixtures on a straight-line basis, with zero ...On October 1, 2014, Lyndon, Inc. purchased a computer system for $86,000 from AIT Systems. The computer system had an estimated life of 5 years and residual value of $3,000. Lyndon paid $2,820 for shipping and insurance and ...On March 1, Taikin Manufacturing Ltd. purchased a factory with a lot of land and a machine for $818,000. Taikin paid legal fees of $2,000 for this purchase, renovation costs on the building of $27,000, and the $8,000 cost of ...On January 7, Red Tucker, Inc. paid $254,700 for equipment used in manufacturing automotive supplies. In addition to the basic purchase price, the company paid $500 transportation charges, $300 insurance for the equipment ...Larry Johnson owns Larry’s Limousine, which operates a fleet of limousines and shuttle buses. Upon reviewing the most recent financial statements, he became confused over the recent decline in net income. He called his ...
Post your question