1. When double-declining balance depreciation is used for the recognition of depreciation expense, the statement of cash...
Question:
1. When double-declining balance depreciation is used for the recognition of depreciation expense, the statement of cash flows will show an outflow from
a- operating activity.
b- investing activity.
c- financing activity.
d- None of the answers is correct.
2. On January 1, Year 1, Marino Moving Company paid $48,000 cash to purchase a truck. The truck was expected to have a four year useful life and an $8,000 salvage value. If Marino uses the double-declining-balance method, the amount of depreciation expense recognized on the Year 3 income statement is
a- $4,000.
b- $6,000.
c- $12,000.
d- $24,000.
3. On January 1, Year 1, Marino Moving Company paid $48,000 cash to purchase a truck. The truck was expected to have a four year useful life and an $8,000 salvage value. If Marino uses the double-declining-balance method, the amount of accumulated depreciation shown on the Year 3 balance sheet is
a- $24,000.
b- $36,000.
c- $40,000.
d- $42,000.
4. On January 1, Year 1, Marino Moving Company paid $48,000 cash to purchase a truck. The truck was expected to have a four year useful life and an $8,000 salvage value. If Marino uses the double-declining-balance method, the amount of book value shown on the Year 3 balance sheet is
a- $6,000.
b- $8,000.
c- $12,000.
d- $24,000.
Expert Answer:
Determine the presentation of outflow on statement of cash flow Depreciation is a nonoperating expense It is also a noncash expense It is added to net income on computing the net cash flow from operat... View the full answer
