question- E9.5
on 06 1. Depreciation is a process of est valuation, not cost allocation 2. Depreciation provides for the proper recording of expenses (efforts) with revenues results). 3. The book value of a plant asset should approximate its fair value. 4. Depreciation applies to three classes of plant assets land, buildings and equipment 5. Depreciation does not apply to a building because its schulness and revenue producing ability generally remain intact over time. 6. Therevene-producing ability of a depreciables will decine due to wear and tear and to obsolescence 7. Recognizing depreciation on an asset results in an accumulation of cash for replacement of the set 8. The balance in acciated depreciation represents the total cost that has been charged to expensesince placing the set in wervice 9. Depreciation expense and accumulated depreciation are reported on the income statement 10. Three factors affect the computation of depreciation cost, life, and value Instructions Identify each statement as true or false. I false, indicate how to correct the statement E9.5 (LO2), AP Gotham Company purchased a new machine on October 1, 2022, at a cost of $90,000. The company estimated that the machine has a salvage value of $8,100. The machine repeded to be year life. for working handaning Determine straight-line depreciation for partial period. Instructions Compute the depreciation expense under the straight-line method for 2022 and 2003, uning a December 3 year-end. 19.6 (102), AP Linton Company purchased a delivery truck for $34.000 on July 1, 2003. The track has an expected salvage value of 2.000, and is expected to be driven 100,000 miles 15.000 in 2012 and 12.000 in 2003. Untonces the straight-line method of depreciation. de ofe r te Compute depreciation using the straight-live method. Instructions a. Compute depreciation expense for 2022 and 2023 b. Prepare the journal entry to record 22 depreciation c. Prepare the journal entry to record 2023 depreciation. d. show how the truck would be reported in the December 31, 2023, balance sheet E. (LO), AN Victor Minell, the new controller of Santorini Company, has reviewed the expected te g o r i e of weed depreca to lives and sale Computerised annual deprecation. e propound changes. The Accumulated Uf Life Nape Value Type of Asset Acquired Jan 1, 2012 Old Propeudod Pred Building Jan 1, 2014 $700.000 5139,000 Warehouse Jan 1, 2017 120,000 facilements Aler a calendar year in preparing t a d All assets are depreciated by the straight line method. Santorini Compays not remaining mets ms- tion 06 1. Depreciation is a process of evaluation, etcost allocation. 2. Depreciation provides for the proper recording of expenses efforts with revenues (results). 3. The book value of a plant should approximates f or 4. Depreciation applies to the cases of plant and building, and equipment 5. Depreciation does not apply to a building because it w as inde p ending bly metly remains over time 6. The rever-producing ability of a depreciables will decine due to ad d to b e 7. Recognising depreciation na t in an c on of cash foreplatohet 8. The balance in acumulated depreciation presents the total cost that has been charged to placing thei r 9. Depreciation expense and mulated depreciation and reported on the in stant 10. Three factors affect the computation of depreciation cost useful life, and a ge Instructions E9.5 (LO2), AP Gotham Company purchased a machine on October 2003, at a cost of $90.00 Thea ted that the r . The se be g g Determine straight-line depreciation for partial period Instructions Compute the depreciation expense under the straight-line method for 22 and 2023. Auming a December 3 year-end E9.6 (10), AP Linton Company purchased a delivery truck for $34.000 on July 1, 2022. The truck har de saage value of $2,000, and is expected to be dis 100,000 miles over i stedet f 15,000 in 2009 and 12.000 in 2003. Linton uses the straight-line method of depreciation. or de were Compute depreciation using the straight-line method. Instructions B. Compute depreciation expense for 3092 and 2023 b. Prepare the journal entry to record 200 depeeciation c. Prepare the journal entry to record 2093 depreciation d. Show how the truck would be reported in the December 31, 2023, balance sheet E9.7 (LO2), AN Victor Minell, the new controller of Santorini Company, has reviewed the expected useful lives and shape values of selected depreciate at the beginning of a Here are his findings Compte reused anewaldepreciation Salve Value Proposed 50.000 .000 Accumulated Date Depreciation, Art Aquired Cost Jan 1, 2003 Old Proposed Building Jan 2014 $700,000 $30.000 40 5 8 Warehouse Jan. 2017 120,000 23.000 25 20 All assets are depreciated by the straight-line method. Santorini Company uses a calendar year in preparing and financial statements. After discussion, it has apued to accept Victor's propound change (The Trepand is all
