20:36 Jeu. 22 avr. 23 % 4 x Case study Long Term Assets and depreciation DOCX - 14 ko Acc2301: Principles of Accounting Case study: Long Term Assets and depreciation Spring 2021 Real Madrid C.F. Company purchased equipment on January 1, 2007 with a cost basis of $150,000, estimated residual value of $15,000, and a five-year life. The equipment's total expected output is 120,000 units. Actual production for each year was as follows: 2007: 30,000 units; 2008: 40,000 units; 2009: 43,000 units; 2010: 17,000 units; 2011: 10,000 units. A. Prepare a schedule showing the depreciation and book value information for each of the depreciation methods (Straignt line; Units of production, doule declining balance). B. Prepare the adjusting entries on December 31 of each year (from 2007 to 2011) for the three Methods. C. Assume that the asset was sold on April 30, 2009 for a total amount of $40,000. A. What is the book value of the asset at the time of sale. B. Compute the gain or loss from this transaction. C. Record the journal entry of the sale. D. Assume that the asset was sold on June 30, 2010 for a total amount of $40,000. A. What is the book value of the asset at the time of sale. B. Compute the gain or loss from this transaction. C. Record the journal entry of the sale. E. What the total depreciation expense over the five years the company will record under each method. F. Why would the company pick one method over another one. G. If we suppose that Real Madrid C.F.Company is a sole proprietorship, what method they will use? Why? H. If we suppose that Real Madrid C.F.Company is a sole corporation, where managers tend to increase their bonuses related to the income of the firm, what method they will use? Why? Ouvrir Office