Chapter 7: Plant Assets & Intangibles

7.2-32 On January 2, 2010, KJ Corporation acquired equipment for $260,000. The estimated life of the equipment is 5 years or 40,000 hours. The estimated residual value is $20,000. What is the balance in Accumulated Depreciation on December 31, 2011, if KJ Corporation uses the straight-line method of depreciation?
A) |
$96,000 |
B) |
$49,500 |
C) |
$51,500 |
D) |
$53,625 |
7.2-33 On January 2, 2010, KJ Corporation acquired equipment for $260,000. The estimated life of the equipment is 5 years or 40,000 hours. The estimated residual value is $20,000. What is the book value of the asset on December 31, 2011, if KJ Corporation uses the straight-line method of depreciation?
A) $80,000
B) $96,000
C) $104,000
D) $164,000
Copyright 2010 Pearson Education Inc. Publishing as Prentice Hall. 28
7.2-34 On January 2, 2010, KJ Corporation acquired equipment for $260,000. The estimated life of the equipment is 5 years or 40,000 hours. The estimated residual value is $20,000. What is the balance in Accumulated Depreciation on December 31, 2010, if KJ Corporation uses the double-declining-balance method of depreciation?
A) |
$62,400 |
B) |
$88,000 |
C) |
$96,000 |
D) |
$104,000 |
Copyright 2010 Pearson Education Inc. Publishing as Prentice Hall. 29
7.2-35 On January 2, 2010, KJ Corporation acquired equipment for $260,000. The estimated life of the equipment is 5 years or 40,000 hours. The estimated residual value is $20,000. What is the balance in Accumulated Depreciation on December 31, 2011, if KJ Corporation uses the double-declining-balance method of depreciation?
A) $104,000
B) $38,400
C) $166,400
D) $104,000
7.2-36 On January 10, 2010, Maxim Corporation acquired equipment for $ 124,000. The estimated life of the equipment is 3 years or 24,000 hours. The estimated residual value is $10,000. What is the depreciation for 2010, if Baldwin Corporation uses the asset 9,100 hours and uses the units-of-production method of depreciation?
A) $43,225
B) $47,017
C) $41,333
D) $38,000
Copyright 2010 Pearson Education Inc. Publishing as Prentice Hall. 30
7.2-37 On January 10, 2010, Maxim Corporation acquired equipment for $124,000. The estimated life of the equipment is 3 years or 24,000 hours. The estimated residual value is $10,000. What is the balance of Accumulated Depreciation on December 31, 2011, if Baldwin Corporation uses the asset 5,500 hours in 2010 and 4,500 hours in 2011?
A) $76,000
B) $61,218
C) $52,083
D) $47,500
7.2-38 On January 2, 2011, Mosby Corporation acquired equipment for $ 200,000. The estimated life of the equipment is 8 years or 35,000 hours. The estimated residual value is $40,000. What is the book value of the equipment on December 31, 2011, if Mosby Corporation uses the double-declining-balance method of depreciation?
A) |
$128,000 |
||
B) |
$150,000 |
||
C) |
$87,500 |
||
D) |
$72,000 |
Copyright 2010 Pearson Education Inc. Publishing as Prentice Hall. 31
7.2-39 On January 2, 2011, Mosby Corporation acquired equipment for $ 200,000. The estimated life of the equipment is 8 years or 35,000 hours. The estimated residual value is $40,000. What is the amount of depreciation expense for 2011, if the company uses the double-declining-balance method of depreciation?
A) $112,500
B) $87,500
C) $50,000
D) $30,000
7.2-40 On January 2, 2011, Heidi’s Pet Boutique purchased a television for the dog sitting area which cost $8,000. It had an estimated useful life of 5 years and a residual value of $1,000. What is the amount of depreciation expense for 2012, the second year of the asset’s life using the double declining-balance method?
A) |
$3,200 |
||
B) |
$8,000 |
||
C) |
$1,920 |
||
D) |
$2,080 |
Copyright 2010 Pearson Education Inc. Publishing as Prentice Hall. 32

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Solution: Chapter 7: Plant Assets & Intangibles