Reference no: EM132494948

Question 1 - Cullumber Company bought a machine on January 1, 2017. The machine cost $142000 and had an expected salvage value of $29000. The life of the machine was estimated to be 5 years. The depreciation expense using the straight-line method of depreciation is

a. $37667.

b. $28400.

c. $22600.

d. none of these answer choices are correct.

Question 2 - Blossom Company acquires land for $87000 cash. Additional costs are as follows.

Removal of shed $700

Filling and grading 1100

Salvage value of lumber of shed 120

Broker commission 1290

Paving of parking lot 12000

Closing costs 480

Blossom will record the acquisition cost of the land as;

a. $90690.

b. $88770.

c. $87000.

d. $90450.

Question 3 - A truck costing $76000 and on which $65000 of accumulated depreciation has been recorded was discarded as having no value. Recording this event would include a(n)

a. loss of $11000.

b. increase to Accumulated Depreciation for $76000.

c. gain of $11000.

d. increase to Accumulated Depreciation for $65000.

Question 4 - Equipment with a cost of $357000 has an estimated salvage value of $17000 and an estimated life of 4 years or 10000 hours. It is to be depreciated by the straight-line method. What is the amount of depreciation for the first full year, during which the equipment was used 2000 hours?

a. $68000.

b. $85000.

c. $86750.

d. $89250.