On January 1, 2019 machinery was purchased for cash of $700,000. The equipment had an estimated life

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Question:

On January 1, 2019 machinery was purchased for cash of $700,000. The equipment had an estimated life of 5 years with an expected salvage value of $100,000. Using straight-line depreciation, how much depreciation expense will be reported on the machine for 2019?

		a. $ 140,000
		b. $ 120,000
		c. $ 20,000
		d. $ 100,000

Same data as the previous question: On January 1, 2019 machinery was purchased for cash of $700,000. The equipment had an estimated life of 5 years with an expected salvage value of $100,000. Using straight-line depreciation, how much depreciation expense will be reported on the machine for 2020?

		a. $ 240,000
		b. $ 280,000
		c. $ 120,000
		d. $ 200,000
		e. $ 140,000

Same data as the previous question: On January 1, 2019 machinery was purchased for cash of $700,000. The equipment had an estimated life of 5 years with an expected salvage value of $100,000. Using straight-line depreciation, how much accumulated depreciation would be reported for the machine on the December 31, 2021 balance sheet?

		a. $ 120,000
		b. $ 360,000
		c. $ 140,000
		d. $ 420,000
		e. $ 340,000

Same data as the previous question: On January 1, 2019 machinery was purchased for cash of $700,000. The equipment had an estimated life of 5 years with an expected salvage value of $100,000. Using straight-line depreciation, what would the book value of the machinery be on the December 31, 2023 balance sheet?

		a. $ 100,000
		b. $ 120,000
		c. $ 700,000
		d. $ 140,000

On 1/1/16, a company purchased a truck for $50,000. The truck was expected to be used for 5 years after which it would be worthless. On 1/2/19, the company had to replace the truck’s motor and transmission at a cost of $12,000. This $12,000 cost to repair the truck would extend the useful life of the truck for 4 years beyond the original estimate of useful life. The $12,000 repair cost should be

		a. Expensed in 2019.
		b. Depreciated over 2019 and 2020, the final 2 years of the original estimate of useful life.
		c. Depreciated over 2019, 2020, 2021 and 2020, the 4-year increase in the truck’s life.
		d. Depreciated over 2019, 2020, 2021, 2022, 2023 and 2024, the remaining life according to the new estimate.
		e. Depreciated over the 4 years of extended life, beginning in 2021.

Equipment was purchased on 1/1/14 for cash of $45,000. The useful life was estimated to be 10 years and the salvage value was estimated at $5,000. Using the double-declining balance method, how much depreciation expense would be recognized for the first full year of the asset’s estimated useful life?

	a.	$ 8,000
	b.	$ 9,000
	c.	$ 4,000
	d.	$ 4,500

Same data as previous question: Equipment was purchased on 1/1/14 for cash of $45,000. The useful life was estimated to be 10 years and the salvage value was estimated at $5,000. Using the double-declining balance method, how much depreciation expense would be recognized for the second full year of the asset’s estimated useful life?

		a. $ 7,200
		b. $6,200
		c. $ 6,400
		d. $ 7,400
		e. $ 1,800

Same data as previous question: Equipment was purchased on 1/1/14 for cash of $45,000. The useful life was estimated to be 10 years and the salvage value was estimated at $5,000. Using the double-declining balance method, how much depreciation expense would be recognized for the third full year of the asset's estimated useful life?