Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Please help! I have been stuck on this problem for so long!! Thank you! 2. Kaeo Koal Company, Inc. purchased a new mining machine at

Please help! I have been stuck on this problem for so long!! Thank you!

image text in transcribed

image text in transcribed

2. Kaeo Koal Company, Inc. purchased a new mining machine at a total cost of $1,800,000 on the first day of its fiscal year. The firm estimates that the machine has a useful life of six years or 8,000,000 tons of coal and a residual value of $120,000 at the end of its useful life. The following schedule indicates the actual number of tons of coal mined with the machine per year: (Click the icon to view the schedule.) Read the requirements Requirement a. Prepare the depreciation schedule for the machine assuming that Kaeo Koal used the straight-line method. Depreciation Expense Original Cost End-of-Year Accumulated Depreciation End-of-Year Net Book Value (NBV) Year Total Requirement b. Prepare the depreciation schedule for the machine assuming that Kaeo Koal used the units-of-output method. (Enter the rate per unit to the nearest cent. Enter all other amounts to the nearest dollar.) Tons Rate End-of-Year of per Depreciation Expense Original Cost End-of-Year Accumulated Depreciation Net Book Value (NBV) Year Coal Unit Total Requirement c. Prepare the depreciation schedule for the machine assuming that Kaeo Koal used the double-declining balance (DDB) method. (Adjust the depreciation expens Print last year to the necessary amount to arrive at an ending book value equal to the scrap value.) (Do not round intermediary calculations. Only round the amount you input in the cell to the nearest dollar.) Beginning Net Book Value (NBV) Depreciation DDB Rate End-of-Year Accumulated Depreciation End-of-Year Net Book Value (NBV) Year Expense Requirement d. Kaeo Koal sells the mining machine for $938,000 at the end of year 3. What is the gain or loss on sale under each of the depreciation methods in parts (a)(c) above? (Use a minus sign or parentheses for any loss amounts.) Doube-declining balance Straight-line Units-of-output Gain (loss) on sale 1: Data Table Tons of Coal 620,000 1,390,000 1,640,000 1,030,000 770,000 2,550,000 2: Requirements Prepare the depreciation schedules for the machine assuming that Kaeo Koal used the following methods (each case is independent)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Intermediate Accounting

Authors: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella

1st edition

978-0133251579, 133251578, 013216230X, 978-0134102313, 134102312, 978-0132162302

Students also viewed these Accounting questions