1.On May 1, 2015, Casico Toy Inc. purchased a new piece of equipment that cost $52,000. The estimated useful life is five years and the estimated residual value is $ 4,000. During the five years of useful life the equipment is expected to produce 20,000 units.

Assume that the equipment was purchased on January 1st, 2015. If the company uses the double declining balance method of depreciation, what is the depreciation expense for the year ended December 31st, 2018?

$ 3,250

$ 0

$ 750

None of the other alternatives are correct

$3,000

6.Excelsior Inc. began the year with capital assets of $200,000 and accumulated amortization of $100,000. During the year, capital assets were purchased for $50,000 and capital assets were sold for proceeds of $1,000. Amortization expense for the year was $20,000. At the end of the year, Excelsior had capital assets of $242,000 and accumulated amortization of $115,000. What was the gain/loss on the disposal of capital assets?

$5,000 loss

None of the other alternatives are correct

$8,000 gain

$1,000 gain

$2,000 loss

9.The Electric Company buys machinery for $500,000 and gives a promissory note to pay dated 2 years from the purchase date. Interest at 10% and principal are to be repaid at maturity. The life of the asset is also estimated to be two years with no salvage and straight line depreciation is used. We can say that on the purchase date:

The liability will be offset from the asset until paid so initially the transaction will have no effect on total assets

The liability will be offset from the asset but the total asset amount will increase by the amount of the discount amortization each period.

None of the above

The amount shown for the asset on the balance sheet will be the same as the amount shown for the liability

The amount shown for the asset on the balance sheet will differ than the amount shown for the liability