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Turtle Co. purchased equipment on January 2, 2002, for $50,000. The
equipment had an estimated five-year service life. Turtle's policy for
five-year assets is to use the 200% double declining depreciation method
for the first two years of the asset's life, and then switch to the straight-
line depreciation method. In its December 31, 2004 balance sheet, what
amount should Turtle report as accumulated depreciation for equipment?
Question 6
During 2005, Jase Co. incurred research and development costs of
$136,000 in its laboratories relating to a patent that was granted on July
1, 2005. Costs of registering the patent equaled $34,000. The patent's
legal life is 17 years, and its estimated economic life is 10 years. In its
December 31, 2005, balance sheet, what amount should Jase report as
patent, net of accumulated amortization?
Question 7
Weir Co. uses straight-line depreciation for its property, plant, and
equipment, which, stated at cost, consisted of the following: Weir's
depreciation expense for 2005 and 2004 was $55,000 and $50,000,
respectively. What amount was debited to accumulated depreciation
during 2005 because of property, plant, and equipment retirements?
Question 8
On January 2, 2004, Judd Co. bought a trademark from Krug Co. for
$500,000. Judd retained an independent consultant, who estimated the
trademark's remaining life to be unlimited because the trademark will be
renewed indefinitely. Its unamortized cost on Krug's accounting records
was $380,000. At the time of sale, Krug estimated the useful life of the
trademark to be 50 years. In Judd's December 31, 2004 balance sheet,
what amount should be reported as accumulated amortization?