1) For assets acquired during the year (i.e. not on January 1), the Units of Production method requires that depreciation is recorded for only a portion of the first year. To do this, the first year depreciation amount is prorated to reflect the amount of time that the asset was actually owned by the company (i.e. number of days or number of months).

a) True

b)False

2) On January 1, 20X1, your company purchases for $450,000 a machine with an estimated useful life of 7 years and a salvage value of $40,000. Using SYD depreciation, what is 20X4 depreciation expense?

a) $73,214

b) $87,857

c) $58,571

d) $64,286

3) For assets acquired during the year (i.e. not on January 1), the Declining Balance method requires that depreciation is recorded for only a portion of the first year. To do this, the first year depreciation amount is prorated to reflect the amount of time that the asset was actually owned by the company (i.e. number of days or number of months).

a) True

b) False

4) Sum-of-the-years-digits depreciation:

a) is based on how much an asset is used, regardless of how long it is owned

b) is calculated using a different depreciable base each year

c) generally produces the same annual depreciation each year

d) uses a different depreciation rate each year

5) Your firm uses 150% declining balance depreciation. Assets purchased between the 1^st and 15^th of the month are depreciated for the entire month; assets purchased after the 15^th of the month are treated as though they were acquired the following month. On March 12, 20X1, your company purchases a machine for $200,000 that it estimates will last 10 years and have a salvage value of $60,000. What is 20X1 depreciation expense?

		$17,500
		$21,000
		$25,000
		$30,000

Please only answer if you can answer all of these, skip if you have any doubts in any of these questions.

Thank you in advance