13. On 1 January two years' ago, the local Red Cross affiliate acquired new blood-processing equipment costing $400 000. The equipment has an estimated useful life of 10 years and an estimated residual value of $50 000. After making all necessary calculations and entries on 31 December, what are the accumulated depreciation to date and carrying value of the equipment? (Assume that the straight-line method is used) Accumulated depreciation Carrying value as of as of 31 December 31 December $35 000 $330 000 $80 000 $320 000 $70 000 $330 000 $70 000 $280 000 14. Which of the following methods of handling bad debts often potentially leads to an overstatement of assets? Ageing of accounts receivable method Allowance for doubtful debts Percentage of credit sales method Direct write-off method 15. Jeff's Copy Shop purchased equipment for $18,000 on 1 January, 2016. Jeff estimated the useful life to be 3 years with no residual value, and the straight-line method of depreciation will be used. On 1 January, 2017, Jeff decides that the business will use the equipment for a total of 5 more years. What is the revised depreciation expense for 2016? $2,400 $3,000 $6,000 $4,500 16. Which of the following statements regarding accounting for the acquisition of property, plant and equipment is incorrect? When the construction of a building is complete, the cost of interest is recorded as interest expense. Asset acquisition costs that are not expensed immediately are referred to as capital expenditures. When purchasing land, the cost for clearing, draining, filling and grading should be charged to a Land Improvements account. Capital expenditures are expenditures that increase the company's investment in productive facilities