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Chattanooga Company purchased a depreciable asset for $80,000 on January 1, 2012.The estimated salvage value is $20,000, and the estimated useful life is 5 years.The straight-line method is used for depreciation.On January 1, 2014,the company made a capital expenditure of $16,000 for an addition to the asset. What is depreciation expense for 2014?
Determine the value that should be recorded for the building when it is purchased. Assume a 6 percent annual interest rate.
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Xu Company is considering replacing one of its manufacturing machines. The machine has a book value of $45,000 and a remaining useful life of 4 years, at which time its salvage value will be zero.
Compute the amount of profit the company will have for a month in which the company sells 275 lawnmowers.
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