FREE Trial

A building with a cost of $1,050,000 has an estimated residual value of $420,000, has an estimated

Question:

A building with a cost of $1,050,000 has an estimated residual value of $420,000, has an estimated useful life of 36 years, and is depreciated by the straight-line method.
(a) What is the amount of the annual depreciation?
(b) What is the book value at the end of the twentieth year of use?
(c) If at the start of the twenty-first year it is estimated that the remaining life is 20 years and that the residual value is $300,000, what is the depreciation expense for each of the remaining 20 years?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Answer rating: 72% (11 reviews)

a Calculating the amount of Annual Depreciation b C...View the full answer


answer-question-section
Answered By
tutor-profile-image
Ali Khawaja
my expertise are as follows: financial accounting : - journal entries - financial statements including balance sheet, profit & loss account, cash flow statement & statement of changes in equity -consolidated statement of financial position. -ratio analysis -depreciation methods -accounting concepts -understanding and application of all international financial reporting standards (ifrs) -international accounting standards (ias) -etc business analysis : -business strategy -strategic choices -business processes -e-business -e-marketing -project management -finance -hrm financial management : -project appraisal -capital budgeting -net present value (npv) -internal rate of return (irr) -net present value(npv) -payback period -strategic position -strategic choices -information technology -project management -finance -human resource management auditing: -internal audit -external audit -substantive procedures -analytic procedures -designing and assessment of internal controls -developing the flow charts & data flow diagrams -audit reports -engagement letter -materiality economics: -micro -macro -game theory -econometric -mathematical application in economics -empirical macroeconomics -international trade -international political economy -monetary theory and policy -public economics ,business law, and all regarding commerce
4.00+ 1+ Reviews 10+ Question Solved
Related Book For  book-img-for-question
Accounting

Accounting

ISBN: 978-0324662962

23rd Edition

Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren

See More Books
Question Posted:
See More Questions

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 Accounting questions

FE Civil Engineering Handbook Steel Design 1st Edition - ISBN: 0990570037 - Free Book