7.

Johnson Co. uses the production method to depreciate its manufacturing equipment. The equipment cost $120,000 and has an estimated useful life of 100,000 machine hours, with a $10,000 residual value. What would be the depreciation expense for the current period if the machine was used for 800 machine hours?

		a. $960
		b. $920
		c. $1,040
		d. $880

8.

A truck was purchased for $25,000. It had a five-year life and a $4,000 residual value. Under the double-declining-balance method, what is depreciation expense in year two?

		a. $6,000
		b. $5,040
		c. $8,000
		d. $8,400

9.

A note made on July 24 and due in 90 days will mature on what date?

		a. October 23
		b. October 21
		c. October 22
		d. October 24

10.

Assume that the semi-annual cash payments on a particular bond issue are $25,000, and that the accrued interest on the bonds for the first 6 month period is only $24,300. The carrying value of the bonds will change by an amount of:

		a. $700 decrease
		b. $700 increase
		c. cannot be determined from the information given