A truck was purchased for $30,000. It has an estimated five-year life and a $5,000 estimated salvage value. Using the straight-line method of depreciation, what is the assets carrying value (book value) after one year?

Group of answer choices

$25,000

$18,000.

$14,000.

$19,000.

Flag question: Question 2

Question 22 pts

Zimmerman Company purchased a piece of manufacturing equipment for $36,000 on January 1, 2020. The asset was expected to have a four-year life and a $6,000 salvage value. During 2020, depreciation expense using the double-declining balance method would be

Group of answer choices

$ 13,500.

$ 15,000.

$ 18,000.

$ 9,000.

Flag question: Question 3

Question 32 pts

On January 1, 2020, Bush Corporation purchased a machine for $42,800. Bush paid shipping costs of $1,800 for delivery to Bushs warehouse and also paid installation costs of $2,400. Bush estimated the machine would have a useful life of ten years and no estimated salvage value. If Bush records depreciation using the straight-line method, depreciation expense for 2020 is

Group of answer choices

$4,520.

$4,280.

$4,700.

$4,460.

Flag question: Question 4

Question 42 pts

Which of the following statements is true?

Group of answer choices

All of these statements are true.

Tangible long-term operational assets with definite useful lives are depreciated over their estimated useful lives.

Goodwill, trademarks and patents are examples of intangible assets.

Intangible long-term operational assets with definite useful lives are amortized over their estimated useful lives.

Flag question: Question 5

Question 52 pts

Which of the following tangible assets has an indefinite useful life and is therefore NOT depreciated?

Group of answer choices

Land.

Building.

Manufacturing equipment.

Transportation equipment.

Flag question: Question 6

Question 62 pts

Klein, Inc. purchased a piece of manufacturing equipment for $40,000 on January 1, 2020. Using the straight-line method of depreciation, Klein began to depreciate the asset over an estimated useful life of 4 years and with an estimated salvage value of $4,000. At the end of the second year, Klein determined that the equipment actually had three more years remaining (for a total useful life of five years) but that its estimated salvage value would remain at $4,000. Based on this new information, depreciation expense during the third year would be

Group of answer choices

$ 6,000.

$ 0.

$ 9,000.

$ 7,200.

Flag question: Question 7

Question 72 pts

Based on the facts of Question 6, the net book value of the equipment at the end of the third year would be

Group of answer choices

$22,000

$17,500

$16,000

$18,400

Flag question: Question 8

Question 82 pts

The following information pertains to the next three questions (Questions 8, 9 and 10). On January 1, 2020, Bennett Company issued a $10,000 face value bond that sold for 92. The bond had a four-year term and with a coupon (stated) rate of 3% annual interest. The company uses the straight-line method of amortization.

8. The carrying value of the bond liability on January 1, 2020, would be

Group of answer choices

$9,200.

$10,000.

$8,800.

$8,000.

Flag question: Question 9

Question 92 pts

Based on the information provided in Question 8, the amount of interest expense reported on the 2020 income statement would be

Group of answer choices

$276.

$400.

$300.

$500.

Flag question: Question 10

Question 102 pts

Based on the information provided in Question 8, the carrying value of the bond liability on December 31, 2022 (the end of the third year) is expected to be

Group of answer choices

$ 9,200.

$10,000.

$ 9,800.

$ 9,700.

Flag question: Question 11

Question 112 pts

Use the following information to answer the next two questions (Questions 11 and 12). On January 1, 2020, Jacobs Company issued a $100,000 face value bond that sold for 110. The bond had a five-year term and a stated annual interest rate of 6%. The straight-line method of amortization is used.

11. The carrying value of the bond liability on January 1, 2020, would be

Group of answer choices

$110,000.

$108,000.

$100,000.

$ 90,000.

Flag question: Question 12

Question 122 pts

Based on the information provided in Question 11, the amount of interest expense reported on the companys 2021 income statement would be

Group of answer choices

$6,000.

$4,000.

$3,300.

$3,000.

Flag question: Question 13

Question 132 pts

At the end of the third year of its six-year life, a piece of equipment on the balance sheet of ABC Company has a net book value of $15,000. On January 1 of Year 4, ABC incurs $2,000 of ordinary repair and maintenance costs and also makes $3,500 of improvements to the equipment. The $3,500 improvement extends the life of the equipment by two years.

What is the net book value of the equipment on January 1 of Year 4 immediately after ABC records the $2,000 and the $3,500 expenditures?

Group of answer choices

$17,000.

$20,500.

$15,000.

$18,500.

Flag question: Question 14

Question 142 pts

If a bond sells at a discount, which of the following is true?

Group of answer choices

The market interest rate at the time of issue is greater than the stated interest rate on the bond.

The market interest rate is not available.

The market interest rate at the time of issue is the same as the stated interest rate on the bond issue.

The market interest rate at the time of issue is less than the stated interest rate on the bond.

Flag question: Question 15

Question 152 pts

If an asset is depreciated using the double-declining method, which of the following statements is true?

Group of answer choices

All of these statements are true.

Depreciation expense will be higher in the earlier years than it will be in the later years.

Depreciation expense will be unpredictable in each year.

Total depreciation expense over the life of the asset will be higher than it would have been under the straight-line method.