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The Sadie Company purchased a bus to transport its customers. The total cost of the bus is $34,000 with an estimated salvage value of $4,000. The useful life of the bus is 5 years and the bus is expected to operate for 100,000 miles. During the first year of operations, the bus operated for 12,000 miles.
REQUIRED
Question a) Calculate the first year's depreciation expense under the following depreciation methods:
i. Straight-Line
ii. Units of Production
iii. Double-Declining-Balance
Question b) What are the book values for each of the individual years of useful life of the bus under the Double-Declining Balance Method?
Prepare Pelham's accounting entry to record the combination with Sampras using the acquisition method and purchase method."
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Evergreen Company sells lawn and garden products to wholesalers. The company's fiscal year-end is December 31. During 2011, the following transactions related to receivables occurred:
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