2DEPRECIATION UNDER GAAP (FOR BOOK PURPOSES) 1. A company that prepares financial statements under GAAP for a third party, such as a bank, normally engages a CPA unrelated to the company to go over them in one of three different ways. Name each way and briefly describe it. 2. What is the purpose of depreciation? 3. What is the adjusting entry to record $10,000 of depreciation expense? 4. If a company used tax depreciation for its books and were audited, what factor would require the company to recalculate depreciation under one of the GAAP methods? 5. What four factors are required to calculate an asset's depreciation expense? 6. APEX Incorporated purchases a machine with a note payable. Expenditures include the machine ($100,000), freight ($2,500), sales tax ($4,500) and installation ($3,300). Record the journal entry to book the acquisition