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17) If the asset is sold at the end of Year 3, which method would yield
the highest gain (or lowest loss) on disposal of the asset?
The method that will yield the highest gain (or lowest loss) on
disposal of the asset if the asset is sold at the end of Year 3 is
18) Muggsy Bogues Company purchased equipment for $224,700 on
October 1, 2014. It is estimated that the equipment will have a useful
life of 8 years and a salvage value of $24,720. Estimated production
is 39,600 units and estimated working hours are 20,200. During
2014, Bogues uses the equipment for 590 hours and the equipment
produces 1,100 units.
Compute depreciation expense under each of the following methods.
Bogues is on a calendar-year basis ending December 31.
19) Presented below is information related to equipment owned by
Suarez Company at December 31, 2014.
Cost
$ 20,232,000
Accumulated depreciation to date
2,248,000
Expected future net cash flows
15,736,000
Fair value
10,790,400
Suarez intends to dispose of the equipment in the coming year. It is
expected that the cost of disposal will be $ 44,960 . As of December
31, 2014, the equipment has a remaining useful life of 4 years.
20) The following data relate to the Machinery account of Eshkol,
Inc. at December 31, 2014.
Machinery
A
B
C
D
Original cost
$108,560
$120,360
$188,800
$188,800
Year purchased
2009
2010
2011
2013
Useful life
10 years
15,000 hours
15
years
10 years