Reference no: EM132956050

Questions -

Q1. On January 1, 2018, Rowley Company purchased a truck that cost $22,000. The truck had an expected useful life of 5 years and a $4,000 salvage value. The amount of depreciation expense recognized in 2021 assuming that Rowley uses the double declining balance method is?

Q2. On January 1, 2014, Doyle Co. purchased a machine for $2,500. Doyle estimated the useful life of the machine to be 10 years and the salvage value to be $500. Indicate whether each of the following statements is true or false.

a. The accumulated depreciation at the end of 2015 under the straight line method would be $400 (T/F)

b. The depreciation expense for 2015 under the double declining method would be $500 (T/F)

c. At the end of 2015, the book value of the machine under the double declining method would be $1600 (T/F)

d. The depreciation expense for 2014 under the straight-line method would be $250 (T/F)

e. The accumulated depreciation at the end of 2015 under the straight-line method would be $250 (T/F)

Q3. Driscoll Company purchased equipment on January 1, 2010 for $2,400. Driscoll uses straight-line depreciation for the asset, which has a five year estimated useful life and a salvage value estimated at $400. The asset was sold on January 1, 2014 for $1,200 cash. Indicate whether each of the following items related to Driscoll Company is true or false.

a. A gain or loss on a sale of equipment is reported on the balance sheet (T/F)

b. Book value on January 1, 2014 was $1,600 (T/F)

c. On the date of the sale, Driscoll would record a gain of $400 (T/F)

d. Accumulated depreciation on January 1, 2014 was $1,600 (T/F)

e. Annual depreciation for Driscoll's equipment was $500 (T/F)