Sarto Co. purchased a $350,000 asset on 1 January 20X2. In 20X6, the company changed the total
Question:
Sarto Co. purchased a $350,000 asset on 1 January 20X2. In 20X6, the company changed the total useful life from 20 years to 14 years. The asset was originally expected to be sold for $50,000 at the end of its useful life, but that amount was also changed in 20X6 to $20,000. Sarto applies the straight-line method of depreciation to this asset, and had claimed a full year of depreciation in the year of acquisition.
Required:
Calculate 20X6 depreciation expense.
Step by Step Answer:
Carrying value of the asset on 1 Ja...View the full answer
Intermediate Accounting Volume 2
ISBN: 9781260881240
8th Edition
Authors: Thomas H. Beechy, Joan E. Conrod, Elizabeth Farrell, Ingrid McLeod-Dick, Kayla Tomulka, Romi-Lee Sevel
Related Video
In accounting terms, depreciation is defined as the reduction of the recorded cost of a fixed asset in a systematic manner until the value of the asset becomes zero or negligible. An example of fixed assets are buildings, furniture, office equipment, machinery, etc. The land is the only exception that cannot be depreciated as the value of land appreciates with time. Depreciation allows a portion of the cost of a fixed asset to be the revenue generated by the fixed asset. This is mandatory under the matching principle as revenues are recorded with their associated expenses in the accounting period when the asset is in use. This helps in getting a complete picture of the revenue
Students also viewed these Business questions
-
The following additional information is available for the Dr. Ivan and Irene Incisor family from Chapters 1-5. Ivan's grandfather died and left a portfolio of municipal bonds. In 2012, they pay Ivan...
-
The Mission Company Ltd, whose year-end is 31 December, has acquired two items of machinery on leases, the conditions of which are as follows: Item Y: Ten annual instalments of 20,000 each, the first...
-
Read the case study "Southwest Airlines," found in Part 2 of your textbook. Review the "Guide to Case Analysis" found on pp. CA1 - CA11 of your textbook. (This guide follows the last case in the...
-
Steven Stores, Inc. provided the following statement of net income for the current year. All income is subject to a 40% income tax rate. The company also had $ 735 of unrealized holding gains on its...
-
Based on Data Set 16 in Appendix B, assume that Richter scale magnitudes of earthquakes are normally distributed with a mean of 1.184 and a standard deviation of 0.587. a. Earthquakes with magnitudes...
-
The top surface of a heated compartment consists of very smooth (A) and highly roughened (B) portions, and the surface is placed in an atmospheric airstream. In the interest of minimizing total...
-
In your opinion, should controversial art be removed, or should it be displayed as a means of educating the public? The statue of President Theodore Roosevelt flanked by an African American on one...
-
The financial records of Dunbar Inc. were destroyed by fire at the end of 2012. Fortunately, the controller had kept certain statistical data related to the income statement as presented below. 1....
-
Name the type of shift used to describe the difference in the absorption and emission wavelengths and explain what happens to the energy?
-
Duncan Inc. (DI) is a chemical manufacturer located in Southwestern Ontario. The company develops and produces a variety of chemicals that are sold to manufacturing companies across the country....
-
MacDonald Corp. had the following securities outstanding at its fiscal year-end 31 December 20X7: Additional information: a. 20X7 net earnings were $790,000. There were no discontinued operations. b....
-
At the beginning of the last quarter of 2011, Youngston, Inc., a consumer products firm, hired Maria Carrillo to take over one of its divisions. The division manufactured small home appliances and...
-
Lamar's capital balance is $40,960 after admitting Terrell to the partnership by investment. If Lamar's ownership interest is 20% of total partnership capital, what were (1) Terrell's cash investment...
-
What did economists discover about the American households' retirement saving according to Andrew Biggs' article? Are most American households saving adequately for their retirement, or is there a...
-
The Smiling Place manufactures extra-whitening toothpaste. During 2002, the company had the following costs: Direct materials used $41,000 Direct labor 28,000 Factory rent 12,000 Equipment...
-
Festive Favours Inc. ( Festive ) wanted to raise cash to fund its expansion into a new market by issuing long - term bonds. On January 1 , 2 0 2 4 , Festive sold $ 2 , 0 0 0 , 0 0 0 in long - term...
-
The accounts listed below appeared in the December 31 trial balance of the Skysong Theater. Debit Credit Equipment $198,576 Accumulated Depreciation-Equipment $61,080 Notes Payable 90,000 Admissions...
-
You have to prepare a plan for marketing Coke in France. Visit www.invest-in-france.org/north-america/en or www.afii.fr/ North America to find the relevant information.
-
Explain the Hawthorne effect.
-
Koala Inc., a publicly traded company, had 210,000 common shares outstanding on December 31, 2022. During 2023, the company issued 8,000 shares on May 1 and retired 14,000 shares on October 31. For...
-
The 2023 income statement of Tanel Corporation showed net income of $860,000, which included a loss from discontinued operations of $140,000. Tanel had 25,000 common shares outstanding all year. (a)...
-
Audrey Inc. has 1 million common shares outstanding as at January 1, 2023. On June 30, 2023, 4% convertible bonds were converted into 100,000 additional shares. Up to that point, the bonds had paid...
-
The adjusted trial balance for Happ Company follows. Adjusted Trial Balance December 31 Number Account Title Debit Credit 101 Cash $ 4,500 106 153 154 183 201 209 233 307 Accounts receivable Trucks...
-
Kyle borrowed $ 3400 at the rate of 8% for 225 days. Find the interest and amount she paid. [We know, when "T'i.e., the time is given in days then it should be divided by 365 to convert into yea
-
What is (Brick & Mortar) and Web plan for a drive thru bakery in Miami Florida( create one) Location (Brick & Mortar): somewhere in Miami Also what is the answers to the the necessary information,...
Study smarter with the SolutionInn App